Severe obesity (body mass index ⩾35 kg m-2) and type 2 diabetes (T2D) are potent and additive risk factors for non-alcoholic fatty liver disease (NAFLD), including non-alcoholic steatohepatitis (NASH). Scant available evidence indicates that black relative to white patients with severe obesity are less susceptible to NAFLD, but it is unclear if T2D abolishes this apparent racial disparity. Therefore, we compared biopsy-proven NAFLD and its progression between black (n=71) and white (n=155) patients with severe obesity stratified by presence or absence of T2D. Although prevalence of T2D was similar between races (37%, P>0.9), whites were significantly more likely than blacks to have NAFLD, NASH and advanced fibrosis (defined as bridging fibrosis and/or cirrhosis). Importantly, T2D was associated with increased odds of NAFLD, NASH and advanced fibrosis (defined as bridging fibrosis or cirrhosis) in whites only (P<0.05). In turn, a higher proportion of blacks than whites with T2D were free of NAFLD (58 versus 22%, P<0.01). These preliminary findings question translation of the powerful interconnection between T2D and NAFLD in whites with severe obesity to blacks and point to an important role of race in the pathophysiology and treatment of these diseases.