Hepatocyte lipoapoptosis, a critical feature of nonalcoholic steatohepatitis, can be replicated in vitro by incubating hepatocytes with saturated free fatty acids (FFA). These toxic FFA induce Bim expression, which is requisite for their cytotoxicity. Because the FoxO3a transcription factor has been implicated in Bim expression, our aim was to determine if FFA induce Bim by a FoxO3a-dependent mechanism. In Huh-7 cells, the saturated FFA, palmitic and stearic acid, increased Bim mRNA 16-fold. Treatment of cells with the saturated FFA induced FoxO3a dephosphorylation (activation) and nuclear translocation and stimulated a FoxO luciferase-based reporter assay; direct binding of FoxO3a to the Bim promoter was also confirmed by a chromatin immunoprecipitation assay. A small interfering RNA-targeted knockdown of FoxO3a abrogated FFA-mediated Bim induction and apoptosis. FoxO3a was activated by a phosphatase 2A-dependent mechanism, since okadaic acid- and small interfering RNA-targeted knockdown of this phosphatase blocked FoxO3a dephosphorylation, Bim expression, and apoptosis. Consistent with these data, phosphatase 2A activity was also stimulated 3-fold by saturated FFA. Immunoprecpitation studies revealed an FFA-dependent association between FoxO3a and protein phosphatase 2A. FFA-mediated FoxO3a activation by protein phosphatase 2A was also observed in HepG2 cells and murine hepatocytes. In conclusion, saturated FFA stimulate protein phosphatase 2A activity, which activates FoxO3a, inducing expression of the intracellular death mediator Bim.