Nonalcoholic fatty liver disease (NAFLD) comprises a group of clinical syndromes characterized by excessive fat deposition in liver cells. Owing to its increasing incidence, NAFLD has becomea pertinent global health problem as well as an important contributor to the fatality rate of liver and metabolic diseases. Farnesoid X receptor (FXR) has emerged as a new target in the treatment of NAFLD, and related drugs are being reported. This review provides an overview of the structure and function of FXR, along with its important regulatory roles in bile acid metabolism and lipid metabolism. The review also highlights the clinical application of FXR and the progress on basic research related to FXR modulators in NAFLD treatment. Identifying potent FXR modulators, structure-based virtual screening strategy, and the development of new drugs to regulate the allosteric pathway of FXR activity have become effective approaches for the study of novel ligand, which can expand the therapeutic applications of novel FXR agonists. Identification of potential FXR modulators may help elucidate the physiological effects of FXR and provide new opportunities for targeting FXR for metabolic diseases.