This study aimed to elucidate the protective effects and underlying mechanisms of 17β-estradiol (E2) in a mouse model of type 2 diabetes mellitus (T2DM) with comorbid non-alcoholic fatty liver disease (NAFLD). Methods: A T2DM+NAFLD mouse model was established using a high-fat diet combined with intraperitoneal injection of streptozotocin (STZ). Mice were randomly divided into the following groups (n=6 each): model, E2, E2+siNC, and E2+siPGC-1α. An additional control group (n=6) received a standard diet and citrate buffer. Mice in the E2, E2+siNC, and E2+siPGC-1α groups were intraperitoneally injected with 20 μg/kg E2 daily for 8 weeks. Additionally, mice in the E2+siNC and E2+siPGC-1α groups received tail vein injections of either an empty vector or a lentiviral vector targeting PGC-1α knockdown on weeks 1 and 5. After treatment, fasting blood glucose (FBG) was measured by glucometer, and fasting insulin (FINS) levels were determined using ELISA to calculate the homeostasis model assessment for insulin resistance (HOMA-IR). Serum levels of total cholesterol (TC), triglycerides (TG), low-density lipoprotein cholesterol (LDL-C), alanine aminotransferase (ALT), and aspartate aminotransferase (AST) were analyzed using commercial kits. Body and liver weights were recorded to calculate liver index. Hematoxylin-eosin (HE) and Oil Red O staining were performed to evaluate liver histology and lipid deposition. Western blotting was used to assess hepatic expression levels of PGC-1α and estrogen-related receptor alpha (ERRα), while immunofluorescence co-localization and chromatin immunoprecipitation (ChIP)-PCR were employed to analyze protein interaction and promoter binding. Results: Compared to the model group, the E2 group showed significantly reduced FBG, FINS, and HOMA-IR, as well as lower levels of TC, TG, LDL-C, ALT, and AST (P < 0.05). E2 also decreased body weight, liver index, hepatocyte necrosis, degeneration, inflammatory infiltration, and lipid accumulation. Expression levels and co-localization of PGC-1α and ERRα were significantly increased. In contrast, knockdown of PGC-1α in the E2+siPGC-1α group reversed these effects, resulting in aggravated liver pathology and reduced PGC-1α/ERRα expression and interaction (P < 0.05). ChIP-PCR confirmed greater enrichment of ERRα promoter regions by PGC-1α compared to IgG control (P < 0.05). Conclusion: E2 alleviates glucose and lipid metabolic dysfunction, hepatic injury, and lipid accumulation in T2DM+NAFLD mice. These effects may be mediated through activation of the PGC-1α/ERRα signaling axis.