BACKGROUND AND OBJECTIVE: The effects of Empagliflozin on liver health in patients with Type 2 Diabetes Mellitus (T2DM) have not been fully elucidated. This study aimed to assess the impact of Empagliflozin on liver steatosis and related biomarkers in T2DM patients. METHODS: A before-after clinical trial was conducted with 119 T2DM patients aged 20 to 70 with fatty liver, recruited from Laghman Hakim Hospital, Tehran, Iran. Participants were administered Empagliflozin for 6 months, with clinical and laboratory assessments conducted at baseline, 3 months, and 6 months. Liver function was evaluated through blood tests and imaging, including ultrasound and Magnetic resonance imaging (MRI), to assess hepatic steatosis. Biomarkers such as HbA1c, fasting blood glucose, insulin, lipid profile, and liver enzymes were measured. Insulin resistance was estimated using the Homeostatic Model Assessment for Insulin Resistance (HOMA-IR) formula. Data were analyzed using SPSS 26 and STATA 14. RESULTS: A total of 119 patients (Intervention (N = 69), Control (N = 50)) were participated. The intervention group demonstrated a significant reduction in liver fat grade compared to the control group, with 17.5% of patients showing a reduction from grade 3 to grade 1 on MRI and 6% in the control group. The odds of worsening fatty liver in the control group were 48 times higher (95% CI: 15.5, 148.5) on MRI and 52 times higher (95% CI: 15.2, 178.1) on ultrasound, compared to the intervention group (NNT = 2). After 6 months, the intervention group showed significantly lower risks for ALT (RR: 0.72, 95% CI: 0.62-0.84), AST, and alkaline phosphatase (Alkp) abnormalities. Liver enzyme levels (ALT, AST, GGT) and systolic blood pressure (SBP) decreased significantly in the Empagliflozin group, with mean differences of -15.33 (95% CI: -18.8, -11.88) for ALT, -12.82 (95% CI: -15.5, -10.13) for AST, and - 6.31 (95% CI: -8.65, -3.97) for systolic blood pressure (SBP). CONCLUSION: These findings suggest that Empagliflozin could be an effective adjunctive therapy for managing liver dysfunction in T2DM patients with NAFLD. TRIAL REGISTRATION: Registered retrospectively in the Iranian Registry of Clinical Trials (IRCT20210811052150N1) on April 16,2023 Access at https://irct.behdasht.gov.ir/search/result?query=IRCT20210811052150N1 .