Aldehyde dehydrogenase 2 (ALDH2) detoxifies toxic aldehydes and has a key role in protecting the liver. An elevated gamma-glutamyl transferase (GGT) level is related to oxidative stress and nonalcoholic fatty liver disease (NAFLD). We herein investigated the association between inactive ALDH2*2 allele (rs671) and the risk of NAFLD, including the relationship to the GGT level. A retrospective follow-up study (mean 5.4±1.1 years) was conducted among 341 Japanese health screening program participants. The receiver operating characteristic curve indicated that the GGT level predicted the development of NAFLD (area under the curve: 0.65, P<0.05) with a cutoff value of 25.5 IUl(-1). The longitudinal risk of NAFLD was higher in the ALDH2*2 allele carriers than in the noncarriers (odds ratio (OR): 2.30, 95% confidence interval (CI): 1.21-4.40), and the risk was further increased among the *2 allele carriers with GGT values ⩾25.5 IUl(-1) (OR: 4.28, 95% CI: 1.80-10.19). On the other hand, there were no significant changes in the subjects' body weight and body mass index during observation period. The ALDH2*2 allele, in relation to the GGT level, may potentially be a novel risk factor for NAFLD.