Nonalcoholic steatohepatitis (NASH) is the commonest liver disease in developed countries. However, there are no current data on the cost-effectiveness of therapeutic options such as lifestyle modification, pioglitazone, or vitamin E. We undertook a cost utility analysis to compare these strategies. Using a third-party payer perspective, a deterministic Markov model was developed to compare costs and health benefits of lifestyle modification alone or with pioglitazone or vitamin E in a cohort of patients aged 50 years with biopsy-proven NASH and fibrosis level 3 or greater. We assumed an annual cycle length over a lifetime horizon. Probability and utility estimates were derived from a systematic literature review, and uncertainties in parameter estimates were tested using one- and two-way sensitivity analyses. Our outcome measure was the incremental cost-effectiveness ratio (ICER), with $A50,000 or less considered cost-effective. In comparison with lifestyle modification alone, treatment with either pioglitazone or vitamin E in addition to lifestyle modification was cost-effective, with incremental cost-effectiveness ratios of $A2748 and $A8475 per quality-adjusted life year (QALY) gained, respectively. In a direct comparison, pioglitazone was more cost-effective than vitamin E (ICER $A2,056/QALY gained). Sensitivity analyses indicated that pioglitazone was not cost-effective if either the total drug cost was greater than $A16,000 per annum, or the annual probability of developing cirrhosis in advanced fibrosis was less than 2%. Conclusion: Our modeled analyses suggest that in patients with advanced fibrosis due to NASH, pharmacological treatment in addition to standard lifestyle modification is likely to be cost-effective.