Ethanol metabolism by liver generates short lived reactive oxygen species that damage liver but also affects distal organs through unknown mechanisms. We hypothesized that dissemination of liver oxidative stress proceeds through release of biologically active oxidized lipids to the circulation. We searched for these by tandem mass spectrometry in plasma of rats fed a Lieber-DeCarli ethanol diet or in patients with established alcoholic liver inflammation, steatohepatitis. We found a severalfold increase in plasma peroxidized phosphatidylcholines, inflammatory and pro-apoptotic oxidatively truncated phospholipids, and platelet-activating factor, a remarkably potent and pleiotropic inflammatory mediator, in rats chronically ingesting ethanol. Circulating peroxidized phospholipids also increased in humans with established steatohepatitis. However, reactive oxygen species generated by liver ethanol catabolism were not directly responsible for circulating oxidized phospholipids because the delayed appearance of these lipids did not correlate with ethanol exposure, hepatic oxidative insult, nor plasma alanine transaminase marking hepatocyte damage. Rather, circulating oxidized lipids correlated with steatohepatitis and tumor necrosis factor-alpha deposition in liver. The organic osmolyte 2-aminoethylsulfonic acid (taurine), which reduces liver endoplasmic reticulum stress and inflammation, even though it is not an antioxidant, abolished liver damage and the increase in circulating oxidized phospholipids. Thus, circulating oxidized phospholipids are markers of developing steatohepatitis temporally distinct from oxidant stress associated with hepatic ethanol catabolism. Previously, circulating markers of the critical transition to pathologic steatohepatitis were unknown. Circulating oxidatively truncated phospholipids are pro-inflammatory and pro-apoptotic mediators with the potential to systemically distribute the effect of chronic ethanol exposure. Suppressing hepatic inflammation, not ethanol catabolism, reduces circulating inflammatory and apoptotic agonists.