Hepatic steatosis is a common histological feature of chronic hepatitis C. Various factors are associated with hepatic steatosis, including obesity, high alcohol consumption, diabetes type II, and hyperlipidaemia. These factors may contribute to steatosis in patients with chronic hepatitis C. In humans, hepatitis C virus (HCV) genotype 3 is more commonly associated with steatosis. In vitro studies and the transgenic mouse model have suggested that the HCV core protein (genotype 1) can induce lipid accumulation within hepatocytes. However, what is the relevance of steatosis in chronic hepatitis C? It seems that in certain populations, steatosis may be associated with fibrosis progression and this may be genotype specific. The mechanisms underlying this association are unknown; neither is it clear whether this holds true for all patients or only a subgroup. Indeed, after antiviral treatment, virus related steatosis disappears whereas the host associated steatosis remains unaffected. This review describes and discusses the basic and clinical aspects of the relationship between steatosis and progression of fibrosis, and response to treatment in patients with chronic hepatitis C.