SUMMARY Alcohol-induced liver disease is a significant clinical problem. Kupffer cells (liver resident macrophages) play crucial roles in the inflammatory responses of alcoholic liver disease. Macrophages have distinct functional states with pro-inflammatory M1 type and anti-inflammatory M2 type. The mechanisms that govern this classical polarization remain to be elucidated. The goals of this study are to: 1) Identify a novel molecular switch that determines M1 vs. M2 polarization in the context of ethanol- induced hepatic steatosis and injury and 2) Evaluate the potential of Kupffer cells as a therapeutic target. An endoplasmic reticulum (ER) resident protein, Nogo-B, also known as reticulon 4B, has been implicated in maintaining ER structure. In the liver, Nogo-B is restricted to non-parenchymal cells including Kupffer cells, liver sinusoidal endothelial cells and hepatic stellate cells, but not in hepatocytes. Our preliminary data demonstrate that Nogo-B levels correlate with the severity of alcoholic liver disease in patients. Nogo-B levels in Kupffer cells were positively associated with M1 polarization and negatively with M2 polarization in human liver specimens. In mice, the absence of Nogo-B resulted in significantly lower levels of hepatic steatosis and injury than wildtype (WT) mice in response to an ethanol diet. Kupffer cells from Nogo-B knockout (KO) mice showed significantly decreased expression of M1 markers, including inducible nitric oxide synthase (iNOS), interleukin 1β (IL1β) and tumor necrosis factor α (TNFα), but exhibited significantly increased M2 markers, such as CD163 and arginase-1, compared to their WT counterparts. Importantly, iNOS, IL1β and TNFα have been reported to enhance hepatic steatosis in alcoholic or non-alcoholic settings and are induced by nuclear factor kappa-light-chain-enhancer of activated B cells (NFkB). Nogo-B KO Kupffer cells exhibited significantly increased ER stress, a factor that induces M2 polarization. Based on these observations from human specimens and animal studies, we hypothesize that Nogo-B regulates Kupffer cell polarization and facilitates hepatic steatosis/injury in response to chronic ethanol consumption and that selective deletion of Nogo-B in Kupffer cells will reduce ethanol-induced hepatic injury. To test these hypotheses, we propose the following three aims: 1) Determine the mechanism by which Nogo-B facilitates M1 polarization of Kupffer cells in response to chronic ethanol consumption, 2) Determine the mechanism by which lack of Nogo-B facilitates M2 polarization of Kupffer cells in response to chronic ethanol consumption, and 3) Determine whether deletion of Nogo-B in Kupffer cells reduces hepatic steatosis and injury in ethanol-fed mice.