The liver plays a critical role in lipid metabolism. Hepatic dysfunction is not only the direct cause of fatty liver disease, but the main risk factor for obesity, diabetes, and other metabolic diseases. So far, therapeutic strategies against fatty liver disease are very limited. Betaine is a methyl donor. Current studies reported that the intake of betaine decreases body fat and is beneficial for treatment of fatty liver disease and metabolic syndrome. However, the underlying mechanisms remain largely unknown. In this study, to investigate the role of betaine on hepatic lipid metabolism and explore the underlying mechanism, HepG2 cells were cultured with fatty acids and betaine. The data indicated that betaine inhibited hepatic fat accumulation and promoted mitochondrial content and activity, suggesting that betaine is involved in the regulation of lipid and energy metabolism. Gene expression analysis implied that betaine inhibits fatty acid synthesis, but stimulates fatty acid oxidation and lipid secretion. Further, to study the mechanism of betaine, FTO (RNA demethylase) and its mutant (loss of demethylase activity) were used. The results showed that FTO blocked the ability of betaine to regulate lipid metabolism and mitochondrial content, but the FTO mutant had no effect, suggesting that betaine influences RNA methylation. This work links betaine administration with mitochondrial activity and RNA methylation, and provides a potential target for the development of new therapeutic strategies for the treatment of fatty liver disease.