Nonalcoholic steatohepatitis (NASH) is a condition characterized by excessive deposition of fat in the liver (steatosis), inflammation and hepatocellular necrosis. While steatosis alone is generally a benign and stable condition, NASH can have a dire prognosis in a minority of patients, mainly because of fibrosis occurrence and progression to cirrhosis. Life-threatening complications such as liver failure and hepatocellular carcinoma have been described in NASH-induced cirrhosis. Insulin resistance is almost universally found in patients with NASH and the main risk factors for this condition are overweight and diabetes. Improvement in insulin sensitivity, whether achieved by diet, exercise and/or pharmacological interventions, results in a dramatic reduction of liver fat and inflammation and fibrosis as well. Therefore NASH should be viewed as the hepatic phenotypic manifestation of insulin resistance and a bona fide component of the metabolic syndrome. Liver injury should be assessed in diabetic and/or obese patients and the mechanisms by which insulin resistance promotes liver damage needs to be elucidated. The encouraging results of the use of PPARgamma agonists and, in particular, rosiglitazone, in human or experimental models of NASH, justifies future large-scale, randomized controlled trials.