Alcoholic liver disease (ALD) and other forms of chronic hepatotoxic injury can lead to transforming growth factor β1 (TGFβ1)-induced hepatic fibrosis and compromised liver function, underscoring the need to develop novel treatments for these conditions. Herein, our analyses of liver tissue samples from severe alcoholic hepatitis (SAH) patients and two murine models of ALD reveals that the ALD phenotype was associated with upregulation of the transcription factor ETS domain-containing protein (ELK-3) and ELK-3 signaling activity coupled with downregulation of α/β hydrolase domain containing 10 (ABHD10) and upregulation of deactivating S-palmitoylation of the antioxidant protein Peroxiredoxin 5 (PRDX5). In vitro, we further demonstrate that ELK-3 can directly bind to theABHD10promoter to inhibit its transactivation. TGFβ1 and epidermal growth factor (EGF) signaling induce ABHD10 downregulation and PRDX5 S-palmitoylation via ELK-3. This ELK-3-mediated ABHD10 downregulation drives oxidative stress and disrupts mature hepatocyte function via enhancing S-palmitoylation of PRDX5’s Cys100 residue. In vivo, ectopic Abhd10 overexpression ameliorates liver damage in ALD model mice. Overall, these data suggest that the therapeutic targeting of the ABHD10-PRDX5 axis may represent a viable approach to treating ALD and other forms of hepatotoxicity.