Fatty liver disease in humans can progress from steatosis to hepatocellular injury, fibrosis, cirrhosis, and liver failure. We developed a series of straightforward assays to determine whether zebrafish larvae with either tunicamycin- or ethanol-induced steatosis develop hepatic dysfunction. We found altered expression of genes involved in acute phase response and hepatic function, and impaired hepatocyte secretion and disruption of canaliculi in both models, but glycogen deficiency in hepatocytes and dilation of hepatic vasculature occurred only in ethanol-treated larvae. Hepatic stellate cells (HSCs) become activated during liver injury and HSC numbers increased in both models. Whether the excess lipids in hepatocytes are a direct cause of hepatocyte dysfunction in fatty liver disease has not been defined. We prevented ethanol-induced steatosis by blocking activation of the sterol response element binding proteins (Srebps) using gonzo(mbtps1) mutants and scap morphants and found that hepatocyte dysfunction persisted even in the absence of lipid accumulation. This suggests that lipotoxicity is not the primary cause of hepatic injury in these models of fatty liver disease. This study provides a panel of parameters to assess liver disease that can be easily applied to zebrafish mutants, transgenics, and for drug screening in which liver function is an important consideration.