Accumulation of free fatty acids (FFAs) in hepatocytes induces lipotoxicity, leading to non-alcoholic fatty liver disease (NAFLD). This study aimed to investigate the underlying mechanisms by which FFA contributes to the pathogenesis of NAFLD via the regulation of 3-mercaptopyruvate sulfurtransferase (MPST), a key enzyme that regulates endogenous hydrogen sulfide (H2S) biosynthesis. Hepatic MPST expression was evaluated in mice and patients with NAFLD. A variety of molecular approaches were used to study the effects of MPST regulation on hepatic steatosis in vivo and in vitro. In vitro treatment of hepatocytes with FFAs upregulated MPST expression, which was partially dependent on NF-κB/p65. Hepatic MPST expression was markedly increased in high fat diet (HFD)-fed mice and patients with NAFLD. Partial knockdown of MPST via adenovirus delivery of MPST short hairpin RNA or heterozygous deletion of the Mpst gene significantly ameliorated hepatic steatosis in HFD-fed mice. Consistently, inhibition of MPST also reduced FFA-induced fat accumulation in L02 cells. Intriguingly, inhibition of MPST significantly enhanced rather than decreased H2S production, whereas MPST overexpression markedly inhibited H2S production. Co-immunoprecipitation experiments showed that MPST directly interacted with and negatively regulated cystathionine γ-lyase (CSE), a major source of H2S production in the liver. Mechanistically, MPST promoted steatosis via inhibition of CSE/H2S and subsequent upregulation of the sterol regulatory element-binding protein 1c pathway, C-Jun N-terminal kinase phosphorylation and hepatic oxidative stress. FFAs upregulate hepatic expression of MPST and subsequently inhibit the CSE/H2S pathway, leading to NAFLD. MPST may be a potential therapeutic target for NAFLD.