Background & Aims Tumor necrosis factor receptor-associated factor 1 (TRAF1) is an important adapter protein that is largely implicated in molecular events regulating immunity/inflammation and cell death. Although inflammation is closely related to and forms a vicious circle with insulin dysfunction and hepatic lipid accumulation, the role of TRAF1 in hepatic steatosis and the related metabolic disorders remains unclear. Methods The participation of TRAF1 in the initiation and progression of hepatic steatosis was evaluated in high fat diet (HFD)-induced and genetic obesity. Mice with global TRAF1 knockout or liver-specific TRAF1 overexpression were employed to investigate the role of TRAF1 in insulin resistance, inflammation, and hepatic steatosis based on various phenotypic examinations. Molecular mechanisms underlying TRAF1-regulated hepatic steatosis were further explored in vivo and in vitro. Results TRAF1 expression was significantly upregulated in the livers of NAFLD patients and obese mice and in palmitate-treated hepatocytes. In response to HFD administration or in ob/ob mice, TRAF1 deficiency was hepatoprotective, whereas the overexpression of TRAF1 in hepatocytes contributed to the pathological development of insulin resistance, inflammatory response and hepatic steatosis. Mechanistically, hepatocyte TRAF1 promotes hepatic steatosis through enhancing the activation of ASK1-mediated P38/JNK cascades, as evidenced by the fact that ASK1 inhibition abolished the exacerbated effect of TRAF1 on insulin dysfunction, inflammation, and hepatic lipid accumulation. Conclusions TRAF1 functions as a positive regulator of insulin resistance, inflammation, and hepatic steatosis dependent on the activation of ASK1-P38/JNK axis. © 2016 European Association for the Study of the Liver.