Non-alcoholic fatty liver disease (NAFLD) poses a serious health hazard affecting 20-40% of adults in the general population in the USA and over 70% of the obese and extremely obese people. In addition to obesity, nicotine is recognized as a risk factor for NAFLD, and it has been reported that nicotine can exaggerate obesity-induced hepatic steatosis. The development of NAFLD has serious clinical complications because of its potential progression from simple hepatic steatosis to non-alcoholic steatohepatitis (NASH), liver cirrhosis, and hepatocellular carcinoma. Multiple mechanisms can be involved in nicotine plus high-fat diet-induced (HFD) hepatic steatosis. Emerging evidence now suggests that nicotine exacerbates hepatic steatosis triggered by HFD, through increased oxidative stress and hepatocellular apoptosis, decreased phosphorylation (inactivation) of adenosine-5-monophosphate-activated protein kinase and, in turn, up-regulation of sterol response-element binding protein 1-c, fatty acid synthase, and activation of acetyl-coenzyme A-carboxylase, leading to increased hepatic lipogenesis. There is also growing evidence that chronic endoplasmic reticulum stress through regulation of several pathways leading to oxidative stress, inflammation, perturbed hepatic lipid homeostasis, apoptosis, and autophagy can induce hepatic steatosis and its progression to NASH. Evidence also suggests a central role of the gut microbiota in obesity and its related disorders, including NAFLD. This review explores the contribution of nicotine and obesity to the development of NAFLD and its molecular underpinning.