Obesity is a major cause of metabolic dysfunction-associated steatohepatitis (MASH) and is characterized by inflammation and insulin resistance. Interferon-γ (IFNγ) is a pro-inflammatory cytokine elevated in obesity and modulating macrophage functions. Here, we show that male mice with loss of IFNγ signaling in myeloid cells (Lyz-IFNγR2-/-) are protected from diet-induced insulin resistance despite fatty liver. Obesity-mediated liver inflammation is also attenuated with reduced interleukin (IL)-12, a cytokine primarily released by macrophages, and IL-12 treatment in vivo causes insulin resistance by impairing hepatic insulin signaling. Following MASH diets, Lyz-IFNγR2-/- mice are rescued from developing liver fibrosis, which is associated with reduced fibroblast growth factor (FGF) 21 levels. These results indicate critical roles for IFNγ signaling in macrophages and their release of IL-12 in modulating obesity-mediated insulin resistance and fatty liver progression to MASH. In this work, we identify the IFNγ-IL12 axis in regulating intercellular crosstalk in the liver and as potential therapeutic targets to treat MASH.