Liver-specific phosphoenolpyruvate carboxykinase (PEPCK) null mice, when fasted, maintain normal whole body glucose kinetics but develop dramatic hepatic steatosis. To identify the abnormalities of hepatic energy generation that lead to steatosis during fasting, we studied metabolic fluxes in livers lacking hepatic cytosolic PEPCK by NMR using 2H and 13C tracers. After a 4-h fast, glucose production from glycogenolysis and conversion of glycerol to glucose remains normal, whereas gluconeogenesis from tricarboxylic acid (TCA) cycle intermediates was nearly absent. Upon an extended 24-h fast, livers that lack PEPCK exhibit both 2-fold lower glucose production and oxygen consumption, compared with the controls, with all glucose production being derived only from glycerol. The mitochondrial reduction-oxidation (red-ox) state, as indicated by the NADH/NAD+ ratio, is 5-fold higher, and hepatic TCA cycle intermediate concentrations are dramatically increased in the PEPCK null livers. Consistent with this, flux through the TCA cycle and pyruvate cycling pathways is 10- and 40-fold lower, respectively. Disruption of hepatic cataplerosis due to loss of PEPCK leads to the accumulation of TCA cycle intermediates and a nearly complete blockage of gluconeogenesis from amino acids and lactate (an energy demanding process) but intact gluconeogenesis from glycerol (which contributes to net NADH production). Inhibition of the TCA cycle and fatty acid oxidation due to increased TCA cycle intermediate concentrations and reduced mitochondrial red-ox state lead to the development of steatosis.