D. candidum Wall. ex Lindl. (D. candidum) is a traditional Chinese herbal medicine with multiple therapeutic properties. D. candidum was administered to mice with high-fat diet (HFD)-induced nonalcoholic fatty liver disease (NAFLD) and its mechanism of action was elucidated. D. candidum was intragastrically administered to HFD mice for 6 weeks at a dosage of 200 or 400 mg/kg. D. candidum reduced body weight gain and blood glucose levels in HFD mice in a dose-dependent manner, while significantly reducing lipid accumulation in the liver. D. candidum significantly regulated the expression of lipid metabolism- and gluconeogenesis-related genes and inhibited activation of the NLRP3 inflammasome. In summary, D. candidum significantly inhibits fat accumulation, maintains lipid metabolism and glucose homeostasis, and inhibits the inflammatory response in the liver of HFD mice. Our findings suggest that D. candidum may be an effective therapeutic strategy against NAFLD injury. Practical applications The occurrence and development of fatty liver is closely related to abnormalities in lipid and glucose metabolism. An HFD-induced NAFLD mouse model was used to study the effects of D. candidum. After treatment with D. candidum, lipid and glucose metabolism in the mice was effectively regulated, which reduced liver damage and fat storage with obvious protective effects on the liver. Our results suggest that D. candidum has potential for further clinical application in the treatment of NAFLD.