Objective Fatty liver disease is known to be correlated with insulin resistance. Recently, fatty liver index (FLI) has been proposed and validated for predicting the presence of fatty liver. A relationship of between visceral fat and fatty liver disease (FLD) has been established; but it is not clear whether skeletal muscle plays a role as a risk factor of FLD. The purpose of this study is to elucidate the association of skeletal muscle and visceral fat in development of fatty liver disease. Methods Among 11,116 (male 6,242) health check-up subjects at Yeungnam University Medical Center in 2009-2011, patients with abnormal liver enzyme (upper normal limit > 2.5 times) and serologic positive finding for hepatitis B or C were excluded. Finally, 9,565 (male 5,293) individuals were included. We categorized into low (< 20), intermediate (20~59) and high (≥ 60) FLI group and determined high FLI group as a fatty liver disease. We measured the skeletal muscle mass and visceral fat area by bioelectric impedance analysis (BIA) and examined how they influence in development of fatty liver disease. Results Low FLI group showed higher skeletal muscle and lower VFA than high group. `Skeletal muscle to Visceral fat Ratio (SVR, g/㎠)` and `Skeletal Muscle Index (SMI, %)` had an inverse correlation with FLI adjusted for age and gender. Comparing quartiles according to SVR, the highest quartile group had the lowest risk of fatty liver disease adjusted for age, gender, lipid profile, DM, HTN and hsCRP (OR=0.037, 95% CI 0.029-0.049). Conclusion Fatty liver disease is associated with not only visceral fat but also skeletal muscle. These results suggest that the body composition including skeletal muscle is more important rather than simple obesity in developing fatty liver disease, and concerns about preventing sarcopenia are needed.