Fatty acid transport protein (FATP)2, a member of the FATP family of fatty acid uptake mediators, has independently been identified as a hepatic peroxisomal very long-chain acyl-CoA synthetase (VLACS). Here we address whether FATP2 is 1) a peroxisomal enzyme, 2) a plasma membrane-associated long-chain fatty acid (LCFA) transporter, or 3) a multifunctional protein. We found that, in mouse livers, only a minor fraction of FATP2 localizes to peroxisomes, where it contributes to approximately half of the peroxisomal VLACS activity. However, total hepatic (V)LACS activity was not significantly affected by loss of FATP2, while LCFA uptake was reduced by 40%, indicating a more prominent role in hepatic LCFA uptake. This suggests FATP2 as a potential target for a therapeutic intervention of hepatosteatosis. Adeno-associated virus 8-based short hairpin RNA expression vectors were used to achieve liver-specific FATP2 knockdown, which significantly reduced hepatosteatosis in the face of continued high-fat feeding, concomitant with improvements in liver physiology, fasting glucose, and insulin levels. Based on our findings, we propose a model in which FATP2 is a multifunctional protein that shows subcellular localization-dependent activity and is a major contributor to peroxisomal (V)LACS activity and hepatic fatty acid uptake, suggesting FATP2 as a potential novel target for the treatment of nonalcoholic fatty liver disease.