Abstract Background: Although use of immune-checkpoint inhibitors (ICI) has yielded impressive results in cancer patients, resistance to ICI therapies has increasingly been observed, especially in hepatocellular carcinoma (HCC). Materials and Methods: We generated a novel anti-programmed death-ligand 1 (PD-L1) treatment resistant mouse hepatoma cell Hepa1-6 (PD-L1R) by 7-generation of in vivo selection. To dissect tumor cell-intrinsic resistant mechanism, we performed single-cell RNA-sequencing (scRNA-seq) from anti-PD-L1-treated tumors generated from parental or PD-L1R cells. Expression level of target genes was detected by QPCR, western blot and immunohistochemical analyses. Lipid content and fatty acid uptake was examined by Oil Red O and BIODIPY staining. Peroxisome proliferator-activated receptor gamma (PPARγ) promoter methylation level was analyzed by bisulfite pyrosequencing. To investigate the tumor cell-extrinsic factors, we profiled the myeloid and lymphoid lineages by flow cytometry. Results: ScRNA-seq revealed significant gene enrichments in lipid metabolism and PPARγ signaling pathway in PD-L1R tumors, which could be verified in both mRNA and protein levels. Moreover, we observed evident lipid accumulation in the PD-L1R tumors when compared to the parental tumors by Oil Red O staining. Consistently, PD-L1R tumor cells exhibited higher lipid content and enhanced fatty acid uptake in vitro, as demonstrated by BODIPY493/503 and BODIPY-C16 analyses. Of note, palmitic acid could dose-dependently increase Pparg mRNA expression in parental cells to a similar level with the PD-L1R cells, supporting an important role of lipids in inducing PPARγ expression. Pyrosequencing analysis indicated that PD-L1R cells exhibited lower PPARγ methylation level compared with parental cells. Notably, 5-Azacytidine treatment in parental cells significantly reduced the promoter DNA methylation and increased Pparg mRNA expression to similar extent with the PD-L1R tumor cells, thus indicating DNA hypomethylation-driven PPARγ up-regulation. Flow cytometry analysis showed that ICI resistance was associated with lower cytotoxic CD8+ T cells but higher intermediate Th17 cells, myeloid-derived suppressor cells and T regulatory cells in the tumor microenvironment (TME). Conclusions: Our study suggested that lipid exposure may epigenetically up-regulate PPARγ transcription in the development of anti-PD-L1 resistance. Detailed investigation on the crosstalk between aberrant lipid metabolism and immunosuppressive TME is ongoing. Acknowledgment: This study is supported by RGC General Research Fund (14120621 and 14119023), Li Ka Shing Foundation and CUHK Strategic Seed Funding for Collaborative Research Scheme. Citation Format: Zhewen Xiong, Stephen Lam Chan, Jingying Zhou, Xuezhen Zeng, Weiqin Yang, Haoran Wu, Jianquan Cao, Jie-Ting Low, Michael Wing-Yan Chan, Kevin Yuk-Lap Yip, Joseph Jao-Yiu Sung, Alfred Sze-Lok Cheng. Lipid-mediated epigenetic activation of PPAR-gamma signaling promotes immune-checkpoint resistance in hepatocellular carcinoma [abstract]. In: Proceedings of the American Association for Cancer Research Annual Meeting 2024; Part 1 (Regular Abstracts); 2024 Apr 5-10; San Diego, CA. Philadelphia (PA): AACR; Cancer Res 2024;84(6_Suppl):Abstract nr 1426.