Nonalcoholic fatty liver disease (NAFLD) is characterized by increased lipid accumulation and excessive deposition of extracellular matrix (ECM) that results in tissue stiffening. The potential interplay between matrix stiffness and hepatocyte lipid accumulation during NAFLD has not been established. Here, an in vitro NAFLD model is developed using chemically defined, engineered hydrogels and human induced pluripotent stem cell-derived hepatic organoids (HOs). Specifically, dynamic covalent chemistry crosslinking, along with transient small molecule competitors, are used to create dynamic stiffening hydrogels that enable the reproducible culture of HOs. Within matrices that mimic the stiffness of healthy to diseased tissue (≈1-6 kPa), lipid droplet accumulation in HOs is triggered by exposure to an NAFLD-associated free fatty acid. These NAFLD model suggests that higher stiffness microenvironments result in increased hepatic lipid droplet accumulation, increased expression of fibrosis markers, and increased metabolic dysregulation. By targeting the ROCK mechanosignaling pathway, the synergy between matrix stiffness and lipid droplet accumulation is disrupted. The in vitro model of NAFLD has the potential to understand the role of mechanosignaling in disease progression and identify new pathways for therapeutic intervention.