Growing evidence indicates that the innate immune system and oxidative stress caused by gut-derived endotoxins play a key role in alcoholic liver disease (ALD). Intracellular mechanisms associated with endotoxin-induced signaling play a crucial role in the initiation and progression of ALD. It is now widely accepted that activation of the innate immune system and increased release of pro-inflammatory cytokines and other mediators play an important role in the development of ALD. Accumulating evidence suggests that alcohol-mediated upregulation of CYP2E1 expression may initiate lipid peroxidation via reactive oxygen species. Non-alcoholic steatohepatitis (NASH) is a liver disease characterized by histopathological features similar to those observed in ALD, but in the absence of significant alcohol consumption. Initial efforts to clarify the mechanisms that promote the progression from steatosis to steatohepatitis somewhat artificially divided disease mechanisms into "first and second hits." This model considered the development of steatosis to be the "first hit," increasing the sensitivity of the liver to the putative "second hit," leading to hepatocyte injury, inflammation, and oxidative stress. We have emphasized the important role of gut-derived bacterial toxins, the innate immune system, and oxidative stress in the common pathogenic mechanism in ALD and NASH progression.