Alcohol-induced liver injury is the most common liver disease in which fatty acid metabolism is altered. It is thought that altered NAD+/NADH redox potential by alcohol in the liver causes fatty liver by inhibiting fatty acid oxidation and the activity of tricarboxylic acid cycle reactions. β-Lapachone (βL), a naturally occurring quinone, has been shown to stimulate fatty acid oxidation in an obese mouse model by activating adenosine monophosphate-activated protein kinase (AMPK). In this report, we clearly show that βL reduced alcohol-induced hepatic steatosis and induced fatty acid oxidizing capacity in ethanol-fed rats. βL treatment markedly decreased hepatic lipids while serum levels of lipids and lipoproteins were increased in rats fed ethanol-containing liquid diets with βL administration. Furthermore, inhibition of lipolysis, enhancement of lipid mobilization to mitochondria and upregulation of mitochondrial β-oxidation activity in the soleus muscle were observed in ethanol/βL-treated animals compared to the ethanol-fed rats. In addition, the activity of alcohol dehydrogenase, but not aldehyde dehydrogenase, was significantly increased in rats fed βL diets. βL-mediated modulation of NAD+/NADH ratio led to the activation of AMPK signaling in these animals. Conclusion: Our results suggest that improvement of fatty liver by βL administration is mediated by the upregulation of apoB100 synthesis and lipid mobilization from the liver as well as the direct involvement of βL on NAD+/NADH ratio changes, resulting in the activation of AMPK signaling and PPARα-mediated β-oxidation. Therefore, βL-mediated alteration of NAD+/NADH redox potential may be of potential therapeutic benefit in the clinical setting.