We investigated the potential of dietary saturated fatty acids to reverse alcoholic liver injury despite continued administration of alcohol. Five groups (six rats/group) of male Wistar rats were studied. Rats in groups 1 and 2 were fed a fish oil-ethanol diet for 8 and 6 weeks, respectively. Rats in groups 3 and 4 were fed fish oil and ethanol for 6 weeks before being switched to isocaloric diets containing ethanol with palm oil (group 3) or medium-chain triglycerides (MCTs, group 4) for 2 weeks. Rats in group 5 were fed fish oil and dextrose for 8 weeks. Liver samples were analyzed for histopathology, lipid peroxidation, nuclear factor-kappaB (NF-kappaB) activation, and mRNAs for cyclooxygenase-2 (Cox-2) and tumor necrosis factor-alpha (TNF-alpha). Endotoxin in plasma was determined. The most severe inflammation and fibrosis were detected in groups 1 and 2, as were the highest levels of endotoxin, lipid peroxidation, activation of NF-kappaB, and mRNAs for Cox-2 and TNF-alpha. After the rats were switched to palm oil or MCT, there was marked histological improvement with decreased levels of endotoxin and lipid peroxidation, absence of NF-kappaB activation, and reduced expression of TNF-alpha and Cox-2. A diet enriched in saturated fatty acids effectively reverses alcohol-induced necrosis, inflammation, and fibrosis despite continued alcohol consumption. The therapeutic effects of saturated fatty acids may be explained, at least in part, by reduced endotoxemia and lipid peroxidation, which in turn result in decreased activation of NF-kappaB and reduced levels of TNF-alpha and Cox-2.