Alcoholic liver disease is a significant contributor to global liver failure. In murine models, chronic ethanol consumption dysregulates PTEN/Akt signaling. Hepatospecific deletion of phosphatase and tensin homolog deleted on chromosome 10 (PTENLKO) mice possess constitutive activation of Akt(s) and increased de novo lipogenesis resulting in increased hepatocellular steatosis. This makes PTENLKO a viable model to examine the effects of ethanol in an environment of preexisting steatosis. The aim of this study was to determine the impact of chronic ethanol consumption and the absence of PTEN (PTENLKO) compared to Alb-Cre control mice (PTENf/f) on hepatocellular damage as evidenced by changes in lipid accumulation, protein carbonylation and alanine amino transferase (ALT). In the control PTENf/f animals, ethanol significantly increased ALT, liver triglycerides and steatosis. In contrast, chronic ethanol consumption in PTENLKO mice decreased hepatocellular damage when compared to PTENLKO pair-fed controls. Consumption of ethanol elevated protein carbonylation in PTENf/f animals but had no effect in PTENLKO animals. In PTENLKO mice, overall hepatic mRNA expression of genes that contribute to GSH homeostasis as well as reduced glutathione (GSH) and oxidized glutathione (GSSG) concentrations were significantly elevated compared to respective PTENf/f counterparts. These data indicate that during conditions of constitutive Akt activation and steatosis, increased GSH homeostasis assists in mitigation of ethanol-dependent induction of oxidative stress and hepatocellular damage. Furthermore, data herein suggest a divergence in EtOH-induced hepatocellular damage and increases in steatosis due to polyunsaturated fatty acids downstream of PTEN.