Carboxyl ester lipase (CEL), a pivotal enzyme involved in lipid metabolism, is recurrently mutated in obese mice. Here, we aimed to elucidate the functional significance, molecular mechanism, and therapeutic potential of CEL in metabolic dysfunction-associated steatohepatitis (MASH). Hepatocyte-specific carboxyl ester lipase gene (Cel) knockout (Cel^ΔHEP) and wildtype (WT) littermates were fed with choline-deficient high-fat diet (CD-HFD) for 16 weeks, or methionine- and choline-deficient diet (MCD) for three weeks to induce MASH. Liquid chromatography-mass spectrometry and co-immunoprecipitation were employed to identify the downstream targets of CEL. CD-HFD/MCD-fed WT mice received intravenous injections of CEL-adeno-associated viral, serotype 8 (AAV8) to induce specific overexpression of CEL in the liver. We observed a decrease in CEL protein levels in MASH induced by CD-HFD or MCD in mice. Cel^ΔHEP mice fed with CD-HFD or MCD exhibited pronounced hepatic steatosis, inflammation, lipid peroxidation, and liver injury compared to WT littermates, accompanied by increased hepatic nuclear factor kappa-light-chain-enhancer of activated B cell (NF-κB) activation. Consistently, Cel knockdown in mouse primary hepatocytes and AML12 cells aggravated lipid accumulation and inflammation, whereas CEL overexpression exerted the opposite effect. Mechanistically, CEL directly bound to fatty acid synthase (FASN), resulting in reduced FASN SUMOylation, which in turn promoted FASN degradation through the proteasome pathway. Furthermore, inhibition of FASN ameliorated hepatocyte lipid accumulation and inflammation induced by Cel knockdown in vivo and in vitro. Hepatocyte-specific CEL overexpression using AAV8-Cel significantly mitigated steatohepatitis in mice fed with CD-HFD or MCD. CEL protects against steatohepatitis development by directly interacting with FASN and suppressing its expression for de novo lipogenesis. CEL overexpression confers a therapeutic benefit in steatohepatitis.