Non‐alcoholic fatty liver disease (NAFLD), characterized by increased hepatic triglycerides (i.e. steatosis), leads to an increased risk for type II diabetes, cardiovascular disease and obesity‐related mortality. Accumulating data points to central nervous system (CNS) alterations as a NAFLD contributor. In this context, we have recently shown that pharmacological inhibition of microglia, the resident immune cells of the brain, attenuates NAFLD during obesity. However, the brain regions involved in this microglial driven steatosis remains unknown. The forebrain subfornical organ (SFO), a circumventricular nucleus situated outside of the blood‐brain‐barrier, has recently been suggested to be critical in NAFLD. Based on this, we hypothesized that SFO microglia activation contributes to hepatic steatosis during obesity. To investigate this, we used a common murine model of diet‐induced NAFLD where male C57Bl/6J mice were fed a high fat diet (HFD, 60% kCal fat) or normal chow for 11 weeks, starting at 6 weeks of age. Immunohistochemistry for ionized calcium‐binding adapter molecule 1 (Iba1) revealed SFO microglia activation following HFD feeding (1.0±0.01 vs 1.4±0.15, relative Iba1 intensity, normal chow vs HFD, p<0.05, n=7). 3‐dimensional analysis further indicated that HFD feeding was associated with a shift to an activated SFO microglia morphology, including decreased branching complexity and shorter dendrites (e.g. branch #/dendrite: 3.1±0.2 vs 2.5±0.1, normal chow vs HFD, p<0.05, n=5/group, 203‐364 microglia/animal). Building upon this, we employed a chemogenetic strategy to selectively inhibit SFO microglia. HFD or normal chow male mice underwent SFO stereotaxic delivery of a designer receptors exclusively activated by designer drugs inhibitory construct targeted to microglia via the CD68 promoter (pAAV‐CD68‐hM4Gi‐mCherry). Following surgical recovery, the pharmacological ligand clozapine‐N‐oxide (CNO; 3 mg/kg i.p.) was administered once daily over 3 days to inhibit SFO microglia. Saline served as a control (n=7–11/group). Short‐term inhibition of SFO microglia did not alter body weight (43±1 vs 42±2 g, HFD saline vs CNO, p>0.05) and food intake in normal chow or HFD fed mice. Similarly, indirect calorimetry evaluations revealed no change in oxygen consumption, respiratory exchange ratio, or energy expenditure in either diet group during SFO microglia inhibition (e.g. energy expenditure: 0.49±0.01 vs 0.49±0.01 kcal/hr, HFD saline vs CNO, p>0.05). Regional adiposity including visceral, subcutaneous, and brown adipose mass was also not different between CNO and saline treated animals. However, histological examination (Oil Red O staining) revealed widespread hepatic lipid accumulation in HFD fed mice (0.4±0.1 vs 36.2±5.5 %stained area; normal chow saline vs HFD saline, p<0.05), which was reduced by ~49% following 3‐day SFO microglia inhibition (18.4±5.4 %stained area, HFD CNO, p<0.05 vs HFD saline). This decline in hepatic steatosis in response to SFO microglia inhibition was further confirmed with liver triglyceride measurements. In line with the direct association of NAFLD and type II diabetes, inhibition of SFO microglia also resulted in a reduction in fed blood glucose levels in obese mice (229±24 vs 182±9 mg/dl, HFD saline vs CNO, p=0.05). Collectively, these results indicate that SFO microglia activation is a critical contributor to hepatic steatosis during obesity.