Nonalcoholic fatty liver disease (NAFLD), hypertriglyceridemia, and elevated free fatty acids are present in the majority of patients with metabolic syndrome and type 2 diabetes mellitus and are strongly associated with hepatic insulin resistance. In the current study, we tested the hypothesis that an increased rate of fatty acid oxidation in liver would prevent the potentially harmful effects of fatty acid elevation, including hepatic triglyceride (TG) accumulation and elevated TG secretion. Primary rat hepatocytes were transduced with adenovirus encoding carnitine palmitoyltransferase 1a (Adv-CPT-1a) or control adenoviruses encoding either β-galactosidase (Adv-β-gal) or carnitine palmitoyltransferase 2 (Adv-CPT-2). Overexpression of CPT-1a increased the rate of β-oxidation and ketogenesis by ∼70%, whereas esterification of exogenous fatty acids and de novo lipogenesis were unchanged. Importantly, CPT-1a overexpression was accompanied by a 35% reduction in TG accumulation and a 60% decrease in TG secretion by hepatocytes. There were no changes in secretion of apolipoprotein B (apoB), suggesting the synthesis of smaller, less atherogenic VLDL particles. To evaluate the effect of increasing hepatic CPT-1a activity in vivo, we injected lean or obese male rats with Adv-CPT-1a, Adv-β-gal, or Adv-CPT-2. Hepatic CPT-1a activity was increased by ∼46%, and the rate of fatty acid oxidation was increased by ∼44% in lean and ∼36% in obese CPT-1a-overexpressing animals compared with Adv-CPT-2- or Adv-β-gal-treated rats. Similar to observations in vitro, liver TG content was reduced by ∼37% (lean) and ∼69% (obese) by this in vivo intervention. We conclude that a moderate stimulation of fatty acid oxidation achieved by an increase in CPT-1a activity is sufficient to substantially reduce hepatic TG accumulation both in vitro and in vivo. Therefore, interventions that increase CPT-1a activity could have potential benefits in the treatment of NAFLD.