A fatty liver is associated with fasting hyperinsulinemia, which could reflect either impaired insulin clearance or hepatic insulin action. We determined the effect of liver fat (LFAT) on insulin clearance and hepatic insulin sensitivity in 80 non-diabetic subjects (age 43±1 yrs, BMI 26.3±0.5 kg/m²). Insulin clearance and hepatic insulin resistance were measured by the euglycemic hyperinsulinemic (insulin infusion rate 0.3 mU/kg·min for 240 min) clamp technique combined with the infusion of [3-³H]glucose, and liver fat by proton magnetic resonance spectroscopy. During hyperinsulinemia, both serum insulin concentrations and increments above basal remained approximately 40% higher (p<0.0001) in the high (15.0±1.5%) as com-pared to the low (1.8±0.2%) LFAT group independent of age, gender and BMI. Insulin clear-ance (ml/kgFFM·min) was inversely related to liver fat content (r=-0.52, p<0.0001) independent of age, gender and BMI (r=-0.37, p=0.001). The variation in insulin clearance due to that in liver fat (range 0-41%) explained on the average 27% of the variation in fS-insulin concentrations. The contribution of impaired insulin clearance to fS-insulin concentrations in-creased as a function of liver fat. This implies that indirect indexes of insulin sensitivity, such as HOMA, overestimate insulin resistance in subjects with high liver fat content. Liver fat content correlated significantly with fS-insulin concentrations adjusted for insulin clearance (r=0.43, p<0.0001), and with directly measured hepatic insulin sensitivity (r=-0.40, p=0.0002). We con-clude that increased liver fat is associated with both impaired insulin clearance and hepatic insu-lin resistance. Hepatic insulin sensitivity associates with liver fat content independent of insulin clearance.