Oxygen dynamics in the liver is a central signaling mediator controlling hepatic homeostasis, and dysregulation of cellular oxygen is associated with liver injury. Moreover, the transcription factor relaying changes in cellular oxygen levels, hypoxia-inducible factor (HIF), is critical in liver metabolism, and sustained increase in HIF signaling can lead to spontaneous steatosis, inflammation, and liver tumorigenesis. However, the direct responses and genetic networks regulated by HIFs in the liver are unclear. To help define the HIF signal-transduction pathway, an animal model of HIF overexpression was generated and characterized. In this model, overexpression was achieved by Von Hippel-Lindau (Vhl) disruption in a liver-specific temporal fashion. Acute disruption of Vhl induced hepatic lipid accumulation in an HIF-2α–dependent manner. In addition, HIF-2α activation rapidly increased liver inflammation and fibrosis, demonstrating that steatosis and inflammation are primary responses of the liver to hypoxia. To identify downstream effectors, a global microarray expression analysis was performed using livers lacking Vhl for 24 hours and 2 weeks, revealing a time-dependent effect of HIF on gene expression. Increase in genes involved in fatty acid synthesis were followed by an increase in fatty acid uptake-associated genes, and an inhibition of fatty acid β-oxidation. A rapid increase in proinflammatory cytokines and fibrogenic gene expression was also observed. In vivo chromatin immunoprecipitation assays revealed novel direct targets of HIF signaling that may contribute to hypoxia-mediated steatosis and inflammation. Conclusion: These data suggest that HIF-2α is a critical mediator in the progression from clinically manageable steatosis to more severe steatohepatitis and liver cancer, and may be a potential therapeutic target. (HEPATOLOGY 2011;)