Objective: To explore the application value of liver function and serological index detection in diagnosing fatty liver. Methods: Ninety patients with fatty liver disease (disease group) and ninety healthy subjects (healthy group) were selected as the subjects of this study. They all underwent liver function index testing and serological index testing. Test results were compared, and the diagnostic accuracy of single and combined tests was evaluated. Results: Liver function indicators of patients in the disease group were higher than those in the healthy group, with severe patients exhibiting higher levels than moderate patients and mild patients (P < 0.05). Serological indicators in patients in the disease group were higher than those in the healthy group, with severe patients showing higher levels than moderate patients and mild patients (P < 0.05). The diagnostic accuracy of liver function index testing was higher than that of serological index testing, and the accuracy of combined testing was higher than that of single testing (P < 0.05). Conclusion: In diagnosing fatty liver, combining liver function testing and serological testing enables the initial diagnosis of the disease and facilitates the accurate assessment of its severity.