BACKGROUND: Lipoatrophic diabetes is an insulin resistance syndrome characterized by the complete or partial lack of adipose tissue and disturbances in lipid and glucose metabolism. Nonalcoholic steatohepatitis (NASH) is a well-described change in liver pathology consisting of steatosis, hepatitis, and fibrosis that can be associated with lipoatrophic diabetes. RESULTS: This article describes the first reported case of lipoatrophic diabetes with NASH leading to liver failure and liver transplantation. Before transplantation, the patient required 600-700 U of insulin/day. After transplantation, a dramatic decline in her insulin requirements was observed, despite corticosteroids. Eighteen months after transplantation, her glycemic control worsened, and she developed recurrent NASH on serial liver biopsies. CONCLUSIONS: NASH associated with lipoatrophic diabetes can recur after liver transplantation, and in this case, was accompanied by increased insulin requirements. These results suggest that the development of NASH itself may contribute to the insulin resistance observed in lipoatrophic diabetes.