Hepatocyte apoptosis is a key feature of metabolic dysfunction-associated steatohepatitis (MASH), but the fate of apoptotic hepatocytes in MASH is poorly understood. Here, we explore the hypotheses that clearance of dead hepatocytes by liver macrophages (efferocytosis) is impaired in MASH because of low expression of the efferocytosis receptor T cell immunoglobulin and mucin domain containing 4 (TIM4; gene Timd4) by MASH liver macrophages, which then drives liver fibrosis in MASH. We show that apoptotic hepatocytes accumulate in human and experimental MASH, using mice fed the fructose-palmitate-cholesterol (FPC) diet or the high-fat, choline-deficient amino acid-defined (HF-CDAA) diet. Apoptotic hepatocyte accumulation is associated with impaired efferocytosis and loss of TIM4. Administration of neutralizing anti-TIM4 antibodies or genetic deletion of Timd4 in Kupffer cells of FPC and HF-CDAA diet-fed mice decreased efferocytosis by liver macrophages, increased profibrotic activation of collagen-producing hepatic stellate cells (HSCs), and accelerated the progression to fibrotic MASH. Genetic restoration of macrophage Timd4 in FPC and HF-CDAA diet-fed MASH mice or cell therapy with TIM4+ macrophages enhanced apoptotic hepatocyte clearance and decreased HSC activation and liver fibrosis. Studies using an ex vivo macrophage HSC cross-talk model and the HF-CDAA MASH model revealed that inactivation of HSCs by efferocytosing macrophages involved macrophage reprogramming to secrete interleukin-10 (IL-10), which activated the IL-10 receptor on HSCs to dampen their profibrotic activation. These findings reveal a key process in the progression from hepatic steatosis to early MASH fibrosis and identify a mechanism-based therapeutic strategy to prevent fibrotic MASH progression.