Liver diseases have become a major comorbidity health concern for people living with HIV-1 (PLWH) treated with combination antiretroviral therapy (cART). To investigate if HIV-1 infection and cART interact to lead to liver diseases, humanized mice reconstituted with progenitor cells from human fetal livers were infected with HIV-1 and treated with cART. We report here that chronic HIV-1 infection with cART induced hepatitis and liver fibrosis in humanized mice, associated with accumulation of M2-like macrophages (M2LMs), elevated TGF-β, and IFN signaling in the liver. Interestingly, IFN-I and TGF-β cooperatively activated human hepatic stellate cells (HepSCs) in vitro. Mechanistically, IFN-I enhanced TGF-β–induced SMAD2/3 activation in HepSCs. Finally, blockade of IFN-I signaling reversed HIV/cART-induced liver diseases in humanized mice. Consistent with the findings in humanized mice with HIV-1 and cART, we detected elevated markers of liver injury, M2LMs, and of IFN signaling in blood specimens from PLWH compared with those of healthy individuals. These findings identify the IFN-I/M2LM/HepSC axis in HIV/cART-induced liver diseases and suggest that inhibiting IFN-I signaling or M2LM may provide a novel therapeutic strategy for treating HIV/cART-associated liver diseases in PLWH treated with antiretroviral therapy.