Nonalcoholic fatty liver disease (NAFLD) is recognized as the leading cause of chronic liver disease in adults and children. NAFLD encompasses a spectrum of liver injuries ranging from steatosis to steatohepatitis with or without fibrosis. Fibrosis may progress to cirrhosis and complications including hepatocellular carcinoma. Histologic findings represent the complexity of pathophysiology. NAFLD is closely associated with obesity and is most closely linked with insulin resistance; the current Western diet, high in saturated fats and fructose, plays a significant role. There are several mechanisms by which excess triglycerides are acquired and accumulate in hepatocytes. Formation of steatotic droplets may be disordered in NAFLD. Visceral adipose tissue dysfunction in obesity and insulin resistance results in aberrant cytokine expression; many cytokines have a role in liver injury in NAFLD. Cellular stress and immune reactions, as well as the endocannabinoid system, have been implicated in animal models and in some human studies.