Nonalcoholic fatty liver disease (NAFLD) is a risk factor for type 2 diabetes (T2D). We aimed to identify the peripheral blood DNA methylation signature of hepatic fat. We conducted epigenome-wide association studies of hepatic fat in 3,400 European ancestry (EA) participants and in 401 Hispanic ancestry and 724 African ancestry participants from four population-based cohort studies. Hepatic fat was measured using computed tomography or ultrasound imaging and DNA methylation was assessed at >400,000 cytosine-guanine dinucleotides (CpGs) in whole blood or CD14+ monocytes using a commercial array. We identified 22 CpGs associated with hepatic fat in EA participants at a false discovery rate <0.05 (corresponding P = 6.9 x 10(-6)) with replication at Bonferroni-corrected P < 8.6 x 10(-4). Mendelian randomization analyses supported the association of hypomethylation of cg08309687 (LINC00649) with NAFLD (P = 2.5 x 10(-4)). Hypomethylation of the same CpG was also associated with risk for new-onset T2D (P = 0.005). Our study demonstrates that a peripheral blood-derived DNA methylation signature is robustly associated with hepatic fat accumulation. The hepatic fat-associated CpGs may represent attractive biomarkers for T2D. Future studies are warranted to explore mechanisms and to examine DNA methylation signatures of NAFLD across racial/ethnic groups.