Obstructive sleep apnea (OSA) causes chronic intermittent hypoxia (CIH) during sleep. OSA is associated with non-alcoholic steatohepatitis (NASH) in obese individuals and may contribute to progression of non alcoholic fatty liver disease from steatosis to NASH. The purpose of this study was to examine whether CIH induces inflammatory changes in the liver in mice with diet-induced hepatic steatosis. C57BL/6J mice (n = 8) on a high fat high cholesterol diet were exposed to CIH for 6 months and compared to mice on the same diet exposed to intermittent air (control, n = 8). CIH caused liver injury with an increase in serum ALT (461 ± 58 U/L vs 103 ± 16 U/L in the control group, p < 0.01) and AST (637 ± 37 U/L vs 175 ± 13 U/L in the control group, p < 0.001), whereas alkaline phosphatase and total bilurubin levels were unchanged. Histology revealed hepatic steatosis in both groups with mild accentuation of fat staining in the zone 3 hepatocytes in mice exposed to CIH. Animals exposed to CIH exhibited lobular inflammation and fibrosis in the liver, which were not evident in control mice. CIH caused significant increases in lipid peroxidation in serum and liver tissue, significant increases in hepatic levels of myeloperoxidase, pro-inflammatory cytokines IL-1, IL-6, CXC chemokine MIP-2, a trend to an increase in TNF-, and an increase in 1(I) collagen mRNA. We conclude that CIH induces lipid peroxidation and inflammation in the livers of mice on a high fat high cholesterol diet.