Thiazolidinediones are insulin sensitisers now widely used for the treatment of Type 2 diabetes mellitus. The initial marketed drug in this class, troglitazone, was removed from the market worldwide after approximately 3 years of use due to rare but severe hepatotoxicity, which sometimes resulted in liver failure leading to the need for liver transplantation, or even death. The unpredictability of such liver toxicity made the use of troglitazone highly problematic. Fortunately, the two newer drugs in this class, rosiglitazone and pioglitazone, have a much larger margin of safety for liver toxicity. Very rare reports of liver toxicity, usually milder and reversible, have been seen with these drugs. Therefore, whilst pharmacovigilance for hepatotoxicity is probably still warranted, the practitioner and patient can be fairly confident that these drugs are safe from a liver standpoint. Finally, recent work would suggest that these agents may prove useful to reduce hepatic fat in patients with non-alcoholic steatohepatitis, and may possibly protect against adverse metabolic consequences and the ultimate development of cirrhosis in patients with fatty livers.