BACKGROUND. An increase in intrahepatic triglyceride (IHTG) is the hallmark feature of nonalcoholic fatty liver disease (NAFLD) and is decreased by weight loss. Hepatic de novo lipogenesis (DNL) contributes to steatosis in individuals with NAFLD. The physiological factors that stimulate hepatic DNL and the effect of weight loss on hepatic DNL are not clear. METHODS. Hepatic DNL, 24-hour integrated plasma insulin and glucose concentrations, and both liver and whole-body insulin sensitivity were determined in individuals who were lean (n = 14), obese with normal IHTG content (n = 26), or obese with NAFLD (n = 27). Hepatic DNL was assessed using the deuterated water method corrected for the potential confounding contribution of adipose tissue DNL. Liver and whole-body insulin sensitivity was assessed using the hyperinsulinemic-euglycemic clamp procedure in conjunction with glucose tracer infusion. Six subjects in the obese-NAFLD group were also evaluated before and after a diet-induced weight loss of 10%. RESULTS. The contribution of hepatic DNL to IHTG-palmitate was 11%, 19%, and 38% in the lean, obese, and obese-NAFLD groups, respectively. Hepatic DNL was inversely correlated with hepatic and whole-body insulin sensitivity, but directly correlated with 24-hour plasma glucose and insulin concentrations. Weight loss decreased IHTG content, in conjunction with a decrease in hepatic DNL and 24-hour plasma glucose and insulin concentrations. CONCLUSIONS. These data suggest hepatic DNL is an important regulator of IHTG content and that increases in circulating glucose and insulin stimulate hepatic DNL in individuals with NAFLD. Weight loss decreased IHTG content, at least in part, by decreasing hepatic DNL.