Non-alcoholic fatty liver disease (NAFLD) is causally linked to type 2 diabetes, insulin resistance and dyslipidemia. In a normal liver, insulin suppresses gluconeogenesis and promotes lipogenesis. In type 2 diabetes, the liver exhibits selective insulin resistance by failing to inhibit hepatic glucose production while maintaining triglyceride synthesis. Evidence suggests that the insulin pathway bifurcates downstream of Akt to regulate these two processes. Specifically, mTORC1 has been implicated in lipogenesis, but its role on hepatic steatosis has not been examined. Here, we generated mice with hepatocyte-specific deletion of Tsc1 to study the effects of constitutive mTORC1 activation in the liver. These mice developed normally but displayed mild hepatomegaly and insulin resistance without obesity. Unexpectedly, the Tsc1-null livers showed minimal signs of steatosis even under high-fat diet condition. This ‘resistant’ phenotype was reversed by rapamycin and could be overcome by the expression of Myr-Akt. Moreover, rapamycin failed to reduce hepatic triglyceride levels in models of steatosis secondary to Pten ablation in hepatocytes or high-fat diet in wild-type mice. These observations suggest that mTORC1 is neither necessary nor sufficient for steatosis. Instead, Akt and mTORC1 have opposing effects on hepatic lipid accumulation such that mTORC1 protects against diet-induced steatosis. Specifically, mTORC1 activity induces a metabolic shift towards fat utilization and glucose production in the liver. These findings provide novel insights into the role of mTORC1 in hepatic lipid metabolism.