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Nonalcoholic fatty liver disease (NAFLD) is the most common cause of chronic liver disease worldwide (Younossi et al., 2019). As more individuals develop obesity, diabetes, and metabolic syndrome, the global prevalence of NAFLD is likewise increasing, affecting as high as a billion people. NAFLD is a spectrum disease that includes a progression from benign hepatic steatosis to nonalcoholic steatohepatitis (NASH) in its most severe form. Approximately 17% of the population advances to liver fibrosis and cancer making NAFLD/NASH the second-most common reason for liver transplantation (Mikolasevic et al., 2018). With the shortage of organ donors, limited supply of healthy liver tissue, and failure of animal models to accurately predict human toxicity, there is a growing interest in hepatocyte-based in vitro systems for research to generate results that better predict human pathophysiology. In this chapter, we will discuss the inherent challenges involved in recapitulating the complex liver tissue in vitro. We will highlight the recent advances in human-induced pluripotent stem cell (hiPSC) technology including three-dimensional (3D) self-organized cell culture models such as spheroids and organoids and the emergence of microphysiological systems that have facilitated the use of iPSC-derived hepatocytes. These hepatocytelike cells isolated from healthy individuals and patients with liver disease or who harbor single nucleotide polymorphisms that make them high risk of developing fatty liver disease have become promising platforms to model in vitro NAFLD for dissecting basic liver biology and for applications in therapeutic screening and clinical evaluation.