Background: Cholestatic liver diseases, including primary sclerosing cholangitis, are characterized by biliary fibroinflammation. TGFβ-activated cholangiocytes release signals that recruit immune cells and activate myofibroblasts, promoting inflammation and extracellular matrix (ECM) deposition. TGFβ also regulates stearoyl-CoA desaturase (SCD), an enzyme involved in lipid signaling. Yet, the role of SCD or its inhibitor, Aramchol, in biliary fibroinflammation had not been studied. Methods and Results: Mdr2 -/- with established biliary fibrosis and 3,5-diethoxycarboncyl-1,4-dihydrocollidine (DDC) diet-fed mice were treated with Aramchol meglumine (12.5 mg/kg/day). Hepatic fibrosis was assessed by qPCR, Picrosirius red staining, immunofluorescence, and hydroxyproline content. Human H69 or murine large cholangiocyte cell lines stimulated with TGFβ, as well as PSC-derived cholangiocytes (PSC-C), were treated with Aramchol or SCD siRNA. RNA-seq, fibroinflammatory marker expression, peroxisome proliferator-activated receptor (PPAR) activity, and targeted fatty acid profiling were performed. Aramchol treatment significantly reduced hepatic ECM gene expression, inflammatory cytokines ( Il6 , Tnfa ), collagen content, and myofibroblast activation (aSMA staining) in both mouse models. In TGFβ-stimulated H69 cells, Aramchol suppressed hepatic fibrosis pathways and enhanced PPAR signaling. Aramchol also reduced the expression of fibrotic markers, myofibroblast-activating mediators ( VEGFA and PDGFB ), and IL6, mirroring the effects of SCD knockdown. In PSC-C, Aramchol significantly downregulated SCD, VEGFA and IL6 . Conversely, PPARα and -γ activity and fatty acid agonist, linoleic acid levels were increased in cholangiocyte cell lines. Conclusions: Aramchol attenuates and prevents biliary fibrosis in mouse models of cholestatic liver disease by inhibiting TGFβ-induced fibroinflammatory mediators and activating PPARa/γ in cholangiocytes. These findings, combined with its favorable clinical safety profile, support the potential of Aramchol as a therapeutic candidate for PSC.