Basal insulin peglispro (BIL) is a novel insulin with hepato-preferential action. In phase 3 trials, BIL showed significantly improved glycemic control but higher levels of transaminases (alanine aminotransferase (ALT) and aspartate aminotransferase (AST)), triglycerides (TGs) and liver fat content (LFC) compared with insulin glargine (GL). As variants in PNPLA3 (I148M) and TM6SF2 (E167K) are associated with nonalcoholic fatty liver disease, we assessed these variants in type 2 diabetes (T2D) patients randomized to receive BIL (n=1822) or GL (n=1270) in three phase 3 trials. Magnetic resonance imaging assessments of LFC were conducted in a subset of patients (n=296). Analyses showed α-corrected significant increases in change from baseline in AST (P=0.0004) and nominal increases in ALT (P=0.019), and LFC (P=0.035) for PNPLA3 (148M/M) genotypes in the BIL arm at 26 weeks but no significant associations in GL. PNPLA3 (148M/M) was also associated with increases in total cholesterol (P=0.014) and low-density lipoprotein cholesterol (P=0.005) but not with hemoglobin A1c or TG. T2D patients with the PNPLA3 (148M/M) genotype treated with BIL may be more susceptible to increased liver fat deposition. The current data provide further insights into the biological role of PNPLA3 in lipid metabolism.