The aim was to examine the effect of free fatty acids on the regulation of PPARγ-PGC1α pathway, and the effect of PPARγ/PGC1α in NAFLD. The mRNA and protein expression of PGC1α and phospho/total PPARγ were examined in Huh7 cells after the palmitate/oleate treatment with/without the transfection with siRNA against PGC1a. The palmitate content, mRNA and protein expression of PGC1α and PPARγ in the liver were examined in the control and NAFLD mice. Palmitate (500 μM), but not oleate, increased protein expression of PGC1α and phospho PPARγ (PGC1α, 1.42-fold, P= 0.038; phospho PPARγ, 1.56-fold, P= 0.022). The palmitate-induced PPARγ mRNA expression was reduced after the transfection (0.46‑fold), and the protein expressions of PGC1α (0.52-fold, P= 0.019) and phospho PPARγ (0.43-fold, P= 0.011) were suppressed in siRNA-transfected cells. The palmitate (12325.8±1758.9 μg/g vs. 6245.6±1182.7 μg/g, p= 0.002), and mRNA expression of PGC1α (11.0 vs. 5.5, p= 0.03) and PPARγ (4.3 vs. 2.2, p= 0.0001) in the liver were higher in high-triglyceride liver mice (> 15.2 mg/g) than in low-triglyceride liver mice (< 15.2 mg/g). The protein expressions of both PGC1α and PPARγ were higher in the NAFLD group than in the controls (PGC1α, 1.41-fold, P= 0.035; PPARγ, 1.39-fold, P= 0.042), and were higher in the high-triglyceride liver group (PGC1α, 1.52-fold, p= 0.03; PPARγ, 1.22-fold, p= 0.05) than in the low-triglyceride liver group. In conclusion, palmitate appear to up-regulate PPARγ via PGC1α in Huh7 cells, and both PGC1α and PPARγ are up-regulated in the NAFLD mice liver, suggesting an effect on lipid metabolism leading to intrahepatic triglyceride accumulation.