Alpha-1-anti-trypsin deficiency is the most common genetic cause of liver disease in children and liver transplantation is currently the only available treatment. Enhancement of liver autophagy increases degradation of mutant, hepatotoxic alpha-1-anti-trypsin (ATZ). We investigated the therapeutic potential of liver-directed gene transfer of transcription factor EB (TFEB), a master gene that regulates lysosomal function and autophagy, in PiZ transgenic mice, recapitulating the human hepatic disease. Hepatocyte TFEB gene transfer resulted in dramatic reduction of hepatic ATZ, liver apoptosis and fibrosis, which are key features of alpha-1-anti-trypsin deficiency. Correction of the liver phenotype resulted from increased ATZ polymer degradation mediated by enhancement of autophagy flux and reduced ATZ monomer by decreased hepatic NFκB activation and IL-6 that drives ATZ gene expression. In conclusion, TFEB gene transfer is a novel strategy for treatment of liver disease of alpha-1-anti-trypsin deficiency. This study may pave the way towards applications of TFEB gene transfer for treatment of a wide spectrum of human disorders due to intracellular accumulation of toxic proteins.