One of the challenges surrounding nonalcoholic fatty liver disease (NAFLD) is to discover the mechanisms that underlie the initiation of it. The aim of the present study was to elucidate the effects of Toll‐like receptor 4 (TLR4) signaling in liver parenchymal cells during the early stage of NAFLD. Male TLR4‐wildtype, TLR4‐knockout, TLR2‐knockout, MyD88‐knockout, and TRIF‐knockout mice were fed a normal diet or high‐fat diet (HFD). Liver steatosis, alanine aminotransferase levels, nuclear translocation of nuclear factor kappa B (NF‐κB) (p65), macrophage accumulation, and neutrophil infiltration were assessed. Using Kupffer cell depletion or bone marrow transplantation, we examined the potential role of Kupffer cells and myeloid infiltrating cells during the initiation of NAFLD. Immunohistochemistry and western blotting were implemented to determine the release of high‐mobility group box1 (HMGB1). The neutral‐antibody against HMGB1 was used to block the activity of free HMGB1. Here we report that the activation of TLR4 signaling in hepatocytes, accompanied with the relocation of P65 in nucleus, was proven to play an important role during the initiation of NAFLD. Importantly, HMGB1 releasing from hepatocytes in response to free fatty acid (FFA) infusion was first reported as the key molecule for the TLR4/MyD88 activation and cytokines expression in vitro and in vivo. Treatment with neutralizing antibody to HMGB1 protects against FFA‐induced tumor necrosis factor alpha and interleukin‐6 production. Conclusion: Our study supports the notion that TLR4/MyD88 signaling in liver parenchymal cells plays a pivotal role during the early progression of HFD‐induced NAFLD, in which free HMGB1 served as a positive component mediating TLR4 activation. (HEPATOLOGY 2011;)