Nonalcoholic steatohepatitis (NASH) is characterized by steatosis, inflammation, and oxidative stress. To investigate whether the transcription factor CCAAT/Enhancer binding protein (C/ EBPβ) is involved in the development of NASH, C57BL/6J wild-type (WT) or C/EBPβ knockout (C/EBPβ-/-) mice were fed either a methionine and choline deficient (MCD) diet or standard chow. These WT mice fed a MCD diet for 4 weeks showed a 2- to 3-fold increase in liver C/EBPβ messenger RNA and protein, along with increased expression of lipogenic genes peroxisome proliferators-activated receptor γ and Fas. WT mice also showed increased levels of the endoplasmic reticulum stress pathway proteins phosphorylated eukaryotic translation initiation factor α, phosphorylated pancreatic endoplasmic reticulum kinase, and C/EBP homologous protein, along with inflammatory markers phosphorylated nuclear factor κB and phosphorylated C-jun N-terminal kinase compared to chow-fed controls. Cytochrome P450 2E1 protein and acetyl coA oxidase messenger RNA involved in hepatic lipid peroxidation were also markedly increased in WT MCD diet-fed group. In contrast, C/EBPβ-/- mice fed a MCD diet showed a 60% reduction in hepatic triglyceride accumulation and decreased liver injury as evidenced by reduced serum alanine aminotransferase and aspartate aminotransferase levels, and by H&E staining. Immunoblots and real-time qPCR data revealed a significant reduction in expression of stress related proteins and lipogenic genes in MCD diet-fed C/EBPβ-/- mice. Furthermore, circulating TNFα and expression of acute phase response proteins CRP and SAP were significantly lower in C/EBPβ-/- mice compared to WT mice. Conversely, C/EBPβ over-expression in livers of WT mice increased steatosis, nuclear factor-κB, and endoplasmic reticulum stress, similar to MCD diet-fed mice. Conclusion: Taken together, these data suggest a previously unappreciated molecular link between C/EBPβ, hepatic steatosis and inflammation and suggest that increased C/EBPβ expression may be an important factor underlying events leading to NASH.