Metabolic liver disease, encompassing nonalcoholic fatty liver (NAFL) and nonalcoholic steatohepatitis (NASH) with insulin resistance as the pathophysiological hallmark, is an emerging issue affecting one in four adults in the U.S. Obesity is characterized by inflammation in the liver, and surrounding macrophages and cytokines may play a major role in metabolic liver disease. Our long-term goal is to understand the molecular mechanism by which obesity causes metabolic liver disease by delineating the role of macrophages and cytokines as a molecular link between insulin resistance, NAFL, and NASH. Interferon-γ (IFNγ), a key regulator of innate and adaptive immunity by priming macrophages, is elevated in obese humans. Our preliminary data indicate that mice with conditional loss of IFNγ signaling in myeloid cells (Lyz-IFNgR2 KO) develop fatty liver after a high-fat diet but are protected from insulin resistance and inflammation in the liver. Moreover, interleukin-12 (IL-12) plays a major role in bridging innate and adaptive immunity by inducing differentiation of Th1 cells, and IL-12 levels are elevated in obese humans and NASH liver. We made a novel observation that IL-12 treatment in vivo causes hepatic insulin resistance by impairing IRS-1 activity in the liver. We also found that IL-12 modulates IRS-2/FoxO1/FGF21 expression in hepatocytes, that may lead to the activation of hepatic stellate cells (HSCs) and fibrogenesis during NAFL progression to NASH. Based on these observations, we hypothesize that obesity-mediated activation of IFNγ signaling in macrophages, through the release of IL-12, causes metabolic liver disease. In Aim 1, we will determine the role of the IFNg-IL12 axis in obesity-mediated insulin resistance in the liver. Metabolic, molecular, and cell-based experiments will be performed in newly created mice with Kupffer cell-selective loss of IFNγ signaling (Clec4f-IFNgR2 KO). We will also apply chronic and liver-targeted IL-12 treatment using AAV8 and mice lacking IL-12 genetically or via liver-selective IL-12 targeting siRNA using GeRPs to test a hypothesis that IL-12 activation of p38 mitogen-activated protein kinase impairs insulin signaling activity and causes insulin resistance in the liver. Aim 2 will delineate the role of the IFNg-IL12 axis in regulating intercellular crosstalk between macrophages, hepatocytes, and HSCs during NAFL progression to NASH. We will examine the effects of the obesogenic Gubra Amylin NASH diet on liver steatosis and fibrosis in Clec4f-IFNgR2 KO, Lyz-IFNgR2 KO, and mice with gain/loss-of-function of IL-12 using 3D-ultrasound and histology. Kupffer cells, hepatocytes, and HSCs will be isolated from the liver for molecular and cell-based experiments to test a hypothesis that IL-12 modulates hepatocyte IRS-2/FoxO1/FGF21 pathway, leading to HSC activation and fibrogenesis. Taken together, these aims will introduce a novel paradigm in which IFNγ signaling and IL-12 act as key mediators of intercellular crosstalk between macrophages, hepatocytes, and HSCs in hepatic insulin resistance and during NAFL progression to NASH in obesity. Our findings will identify IFNγ signaling and IL-12 as potential therapeutic targets to treat metabolic liver disease in humans.