We previously showed that testosterone (T) deficiency enhanced high-fat diet (HFD) induced hepatic steatosis in rats that was independent of insulin resistance, and that T replacement reduced hepatic macrovesicular fat accumulation and inflammation. The present report explores the mechanism of T-protective effects on HFD-induced steatohepatitis. Adult male rats were randomized into four treatment groups for 15 weeks (intact rats on regular chow diet or HFD, and castrated rats on HFD with/without T replacement). Fatty acid β oxidation and de novo synthesis were not changed by castration and T replacement, but expressions of lipid export proteins ApoB100 and microsomal triglyceride transfer protein (MTP) were suppressed by HFD in both intact and castrated rats and restored by T replacement. Macrovesicular lipid droplet-related proteins perilipin 1 and fat-specific protein 27 were increased by HFD in castrated rats and suppressed by T replacement. Higher activation/expression of ER stress proteins [PERK, IRE-1α, JNK, NF-B, and CHOP] were demonstrated in castrated rats fed HFD compared to intact animals, and T replacement suppressed these changes. We conclude that 1) HFD leads to ApoB100/MTP suppression reducing export of lipids; 2) Castration promotes progression to steatohepatitis through activation of the ER stress pathway and enhancement of macrovesicular droplet protein expression; 3) Testosterone suppresses ER stress, inhibits the formation of macrovesicular lipid droplets, promotes lipid export, and ameliorates steatohepatitis induced by HFD and castration.