As the prevalence of childhood obesity increases, the incidence of nonalcoholic fatty liver disease and nonalcoholic steatohepatitis (NASH) also escalates. This study's purpose was to identify the clinical criteria to aid in determining when a liver biopsy is indicated for this growing population because currently no guidelines exist. We performed a retrospective chart review on all patients who were seen in the Nutrition Exercise and Weight Loss Kids™ Program at the Children's Hospital of Wisconsin from July 2003 through December 2004. We analyzed only individuals who underwent liver biopsy with the following criteria: (1) no evidence of other liver disease and (2) aspartate transaminase or alanine aminotransferase greater than 200 IU/L or any elevation of or for more than 6 months. Of the 284 patients reviewed, only eight patients (3%) met the criteria for analysis. Biopsy results demonstrated that 100% had histological evidence of NASH with steatosis, and seven of the eight (87.5%) had NASH with fibrosis, cirrhosis, or both. Obese children with an aspartate transaminase or alanine aminotransferase greater than 200 IU/L or any elevation of aspartate transaminase or alanine aminotransferase for more than 6 months, have a strong likelihood of having NASH with or without fibrosis, cirrhosis, or both.