Fatty liver hemorrhage syndrome (FLHS) in chickens is characterized by steatosis and bleeding in the liver, which has caused huge losses to the poultry industry. This study aimed to use primary cultured broiler hepatocytes to establish a steatosis model to explore the optimal conditions for inducing steatosis by incubating the cells with a fat emulsion. Primary hepatocytes were isolated from an AA broiler by a modified two-step in situ perfusion method. Hepatocytes were divided into an untreated control group and a fat emulsion group that was incubated with 2.5, 5, 10, or 20% fat emulsion for different times to determine the optimal conditions for inducing steatosis of primary hepatocytes. Incubation of the cells with 10% fat emulsion resulted in cell viability at 48 h of 67%, which was higher than the control group and met the requirements of the model. In the second experiment, steatosis was induced by incubating hepatocytes with 10% fat emulsion for 48 h. In consequence, the apoptosis rate decreased (p > 0.05) and the concentration of ALT (p < 0.001), AST (p < 0.01), and TG (p < 0.05) increased significantly; the expression level of SREBP-1c (p < 0.05) increased, and the expression levels of PPARα (p < 0.001), CPT1 (p < 0.001), and CPT2 (p < 0.05) were lower in the fat emulsion group than in the control group. In conclusion, the induction condition was selected as 10% fat emulsion incubation for 48 h, and we successfully established a fatty liver degeneration model for broilers.