Coronavirus disease 2019 (COVID-19) is a global pandemic that has caused more than 600 million cases and over six million deaths worldwide. Despite the availability of vaccination, COVID-19 cases continue to grow making pharmacological interventions essential. Remdesivir (RDV) is an FDA-approved antiviral drug for treatment of both hospitalized and non-hospitalized COVID-19 patients, albeit with potential for hepatotoxicity. This study characterizes the hepatotoxicity of RDV and its interaction with dexamethasone (DEX), a corticosteroid often co-administered with RDV for inpatient treatment of COVID-19. Human primary hepatocytes and HepG2 cells were used as in vitro models for toxicity and drug-drug interaction studies. Real-world data from hospitalized COVID-19 patients were analyzed for drug-induced elevation of serum ALT and AST. In cultured hepatocytes, RDV markedly reduced the hepatocyte viability and albumin synthesis, while it increased the cleavage of caspase-8 and caspase-3, phosphorylation of histone H2AX, and release of ALT and AST in a concentration-dependent manner. Importantly, co-treatment with DEX partially reversed RDV-induced cytotoxic responses in human hepatocytes. Moreover, data from COVID-19 patients treated with RDV with and without DEX co-treatment suggested that among 1037 patients matched by propensity score, receiving the drug combination was less likely to result in elevation of serum AST and ALT levels (≥ 3 × ULN) compared to the RDV alone treated patients (OR = 0.44, 95% CI = 0.22-0.92, p = 0.03). Our findings obtained from in vitro cell-based experiments and patient data analysis provide evidence suggesting combination of DEX and RDV holds the potential to reduce the likelihood of RDV-induced liver injury in hospitalized COVID-19 patients.