An improved paper-based device using indoxyl acetate as a chromogenic substrate was developed for rapid qualitative determination of lipase inhibitory activity. Colorless indoxyl acetate can be catalytically hydrolyzed by lipase to produce the blue-colored indigo dimer on the paper device. In the presence of a lipase inhibitor, enzyme activity diminishes, resulting in reduced hydrolysis of indoxyl acetate. Consequently, this leads to a decrease in the intensity of the blue coloration, which can be visually observed across a range of blue shades and analyzed using image analysis. Orlistat was used as the representative lipase inhibitor in the assay. The LODs obtained from visual detection and the image analysis were comparable. The paper-based device using indoxyl acetate for lipase inhibition assay was simple and convenient. It could be useful as a simple screening method for the detection of orlistat adulteration in weight loss supplements.