Kupffer cells have been implicated in the pathogenesis of various liver diseases. However, their involvement in metabolic disorders of the liver, including fatty liver disease, remains unclear. The present study sought to determine the impact of Kupffer cells on hepatic triglyceride storage and to explore the possible mechanisms involved. To that end, C57Bl/6 mice rendered obese and steatotic by chronic high‐fat feeding were treated for 1 week with clodronate liposomes, which cause depletion of Kupffer cells. Loss of expression of marker genes Cd68, F4/80, and Clec4f, and loss of Cd68 immunostaining verified almost complete removal of Kupffer cells from the liver. Also, expression of complement components C1, the chemokine (C‐C motif) ligand 6 (Ccl6), and cytokines interleukin‐15 (IL‐15) and IL‐1β were markedly reduced. Importantly, Kupffer cell depletion significantly decreased liver triglyceride and glucosylceramide levels concurrent with increased expression of genes involved in fatty acid oxidation including peroxisome proliferator‐activated receptor alpha (PPARα), carnitine palmitoyltransferase 1A (Cpt1α), and fatty acid transport protein 2 (Fatp2). Treatment of mice with IL‐1β decreased expression of PPARα and its target genes, which was confirmed in primary hepatocytes. Consistent with these data, IL‐1β suppressed human and mouse PPARα promoter activity. Suppression of PPARα promoter activity was recapitulated by overexpression of nuclear factor κB (NF‐κB) subunit p50 and p65, and was abolished upon deletion of putative NF‐κB binding sites. Finally, IL‐1β and NF‐κB interfered with the ability of PPARα to activate gene transcription. Conclusion: Our data point toward important cross‐talk between Kupffer cells and hepatocytes in the regulation of hepatic triglyceride storage. The effect of Kupffer cells on liver triglycerides are at least partially mediated by IL‐1β, which suppresses PPARα expression and activity. (HEPATOLOGY 2010.)