Diabetes and liver disease share a close and complex relationship rooted in metabolic dysfunction. Insulin resistance and chronic hyperglycemia contribute to fat accumulation in the liver, leading to conditions such as non-alcoholic fatty liver disease (NAFLD) and non-alcoholic steatohepatitis (NASH). Conversely, liver dysfunction can worsen glucose metabolism, increasing the risk of diabetes development and complications. Understanding the interplay between hepatic insulin sensitivity, inflammation, and lipid metabolism is essential for effective prevention and management. Early screening, lifestyle interventions, and novel pharmacotherapies play a critical role in protecting both liver and metabolic health.