Non-alcoholic fatty liver disease (NAFLD) is a global pandemic affecting 25% of the world’s population and is a serious health and economic concern worldwide. NAFLD is mainly the result of unhealthy dietary habits combined with sedentary lifestyle, although some genetic contributions to NAFLD have been documented. NAFLD is characterized by the excessive accumulation of triglycerides (TGs) in hepatocytes and encompasses a spectrum of chronic liver abnormalities, ranging from simple steatosis (NAFL) to steatohepatitis (NASH), significant liver fibrosis, cirrhosis, and hepatocellular carcinoma. Although the molecular mechanisms that cause the progression of steatosis to severe liver damage are not fully understood, metabolic-dysfunction-associated fatty liver disease is strong evidence that mitochondrial dysfunction plays a significant role in the development and progression of NAFLD. Mitochondria are highly dynamic organelles that undergo functional and structural adaptations to meet the metabolic requirements of the cell. Alterations in nutrient availability or cellular energy needs can modify mitochondria formation through biogenesis or the opposite processes of fission and fusion and fragmentation. In NAFL, simple steatosis can be seen as an adaptive response to storing lipotoxic free fatty acids (FFAs) as inert TGs due to chronic perturbation in lipid metabolism and lipotoxic insults. However, when liver hepatocytes’ adaptive mechanisms are overburdened, lipotoxicity occurs, contributing to reactive oxygen species (ROS) formation, mitochondrial dysfunction, and endoplasmic reticulum (ER) stress. Impaired mitochondrial fatty acid oxidation, reduction in mitochondrial quality, and disrupted mitochondrial function are associated with a decrease in the energy levels and impaired redox balance and negatively affect mitochondria hepatocyte tolerance towards damaging hits. However, the sequence of events underlying mitochondrial failure from steatosis to hepatocarcinoma is still yet to be fully clarified. This review provides an overview of our understanding of mitochondrial adaptation in initial NAFLD stages and highlights how hepatic mitochondrial dysfunction and heterogeneity contribute to disease pathophysiology progression, from steatosis to hepatocellular carcinoma. Improving our understanding of different aspects of hepatocytes’ mitochondrial physiology in the context of disease development and progression is crucial to improving diagnosis, management, and therapy of NAFLD/NASH.