Nonalcoholic steatohepatitis (NASH) has become the most common cause of chronic liver disease worldwide in recent years. The pathogenesis of NASH is closely linked to metabolic diseases such as insulin resistance, obesity, dyslipidemia, and type 2 diabetes. However, there is currently no pharmacological agent for preventing the progression of NASH. Sodium–glucose cotransporter (SGLT) 2 inhibitors increase urinary glucose excretion by inhibiting renal glucose reabsorption, and improve various pathological conditions of type 2 diabetes, including insulin resistance. In the present study, we examined the effects of ipragliflozin, a SGLT2‐selective inhibitor, alone and in combination with pioglitazone on NASH in high‐fat diet‐fed KK/Ay type 2 diabetic mice. Type 2 diabetic mice with NASH exhibited steatosis, inflammation, and fibrosis in the liver as well as hyperglycemia, insulin resistance, and obesity, features that are observed in human NASH. Four‐week repeated administration of ipragliflozin (0.1–3 mg/kg) led to significant improvements in hyperglycemia, insulin resistance, and obesity in addition to hyperlipidemia and liver injury including hepatic steatosis and fibrosis. Moreover, ipragliflozin reduced inflammation and oxidative stress in the liver. Repeated administration of pioglitazone (3–30 mg/kg) also significantly improved various parameters of diabetes and NASH, excluding obesity. Furthermore, combined treatment comprising ipragliflozin (1 mg/kg) and pioglitazone (10 mg/kg) additively improved these parameters. These findings indicate that the SGLT2‐selective inhibitor ipragliflozin improves hyperglycemia as well as NASH in type 2 diabetic mice. Therefore, treatment with ipragliflozin monotherapy or coadministered with pioglitazone is expected to be a potential therapeutic option for the treatment of type 2 diabetes with NASH.