We have previously demonstrated that treatment of hepatocytes with IFN gamma results a series of cellular injury processes, including DNA synthesis arrest, membrane breakage and apoptosis. In the present work, we show that IFN gamma suppresses cellular respiration and protein synthesis in hepatocytes, and that cellular respiration suppression is an early event in the IFN gamma-induced cellular injuries. Polyunsaturated fatty acids (PUFAs) increased cellular respiration of hepatocytes, but only linoleic acid showed some protective effect against IFN gamma-induced cellular respiration suppression. Linoleic acid also reduced other IFN gamma-mediated cellular injuries, including membrane breakage and protein synthesis inhibition. Like linoleic acid, fetal bovine serum also inhibited IFN gamma-induced cellular damage. Increased NAD levels were found in both IFN gamma-treated and non-treated hepatocytes following the addition of PUFAs, but clofibrate, a peroxisome proliferator, bromophenacyl bromide (BPB), an inhibitor of phospholipase, nordihydroguaiaretic acid (NDGA), an inhibitor of lipoxygenase, and arachidonic acid, a metabolite of linoleic acid, did not inhibit IFN gamma-induced cellular injury. In addition, the combination of linoleic acid and IFN gamma induced nitric oxide (NO) synthesis in hepatocytes. These results suggest that fatty acid may play an important role in liver homeostasis during chronic inflammatory states and sepsis.