Background The bile acid derivative 6-ethylchenodeoxycholic acid (obeticholic acid) is a potent activator of the farnesoid X nuclear receptor that reduces liver fat and fibrosis in animal models of fatty liver disease. We assessed the efficacy of obeticholic acid in adult patients with non-alcoholic steatohepatitis. Methods We did a multicentre, double-blind, placebo-controlled, parallel group, randomised clinical trial at medical centres in the USA in patients with non-cirrhotic, non-alcoholic steatohepatitis to assess treatment with obeticholic acid given orally (25 mg daily) or placebo for 72 weeks. Patients were randomly assigned 1:1 using a computer-generated, centrally administered procedure, stratified by clinical centre and diabetes status. The primary outcome measure was improvement in centrally scored liver histology defined as a decrease in non-alcoholic fatty liver disease activity score by at least 2 points without worsening of fibrosis from baseline to the end of treatment. A planned interim analysis of change in alanine aminotransferase at 24 weeks undertaken before end-of-treatment (72 weeks) biopsies supported the decision to continue the trial (relative change in alanine aminotransferase -24%, 95% CI -45 to -3). A planned interim analysis of the primary outcome showed improved efficacy of obeticholic acid (p=0·0024) and supported a decision not to do end-of-treatment biopsies and end treatment early in 64 patients, but to continue the trial to obtain the 24-week post-treatment measures. Analyses were done by intention-to-treat. This trial was registered with ClinicalTrials.gov, number NCT01265498. Findings Between March 16, 2011, and Dec 3, 2012, 141 patients were randomly assigned to receive obeticholic acid and 142 to placebo. 50 (45%) of 110 patients in the obeticholic acid group who were meant to have biopsies at baseline and 72 weeks had improved liver histology compared with 23 (21%) of 109 such patients in the placebo group (relative risk 1·9, 95% CI 1·3 to 2·8; p=0·0002). 33 (23%) of 141 patients in the obeticholic acid developed pruritus compared with nine (6%) of 142 in the placebo group. Interpretation Obeticholic acid improved the histological features of non-alcoholic steatohepatitis, but its long-term benefits and safety need further clarification. Funding National Institute of Diabetes and Digestive and Kidney Diseases, Intercept Pharmaceuticals.