This study hypothesized that upregulation of inducible nitric oxide synthase (iNOS) would preserve the metabolic status of the liver under conditions of steatosis and acute inflammation. Wild-type C57BL/6J and C57BL/6 iNOS-knockout (-/-) mice were fed a choline-deficient ethionine-supplemented diet (CDE). Mice were also injected with 5 mg/kg lipopolysaccharide (LPS) to induce endotoxemia. Consumption of the CDE diet led to steatosis of the liver and decreased expression of the gluconeogenic genes compared wth controls. LPS treatment exacerbated these effects because of inhibition of PGC-1α expression, which resulted in hypoglycemia. In steatotic livers, LPS-induced iNOS expression was enhanced. Comparison between wild-type and iNOS-knockout mice under these conditions demonstrated a protective role of iNOS against fatal hypoglycemia. Nitric oxide (NO) signaling effects were confirmed by treatment of hepatocytes in culture with an NO donor, which resulted in increased expression of PGC-1α and gluconeogenic genes. In conclusion, iNOS was found to act as a protective protein and provides a possible mechanism by which the liver preserves glucose homeostasis under stress. Antioxid.