PURPOSE: To investigate the accuracy and reproducibility of hepatic lipid measurements using 1H magnetic resonance spectroscopy (MRS) with T2 relaxation correction, compared to measurements without correction. MATERIALS AND METHODS: Experiments were conducted in phantoms of varying lipid and iron-induced susceptibility to simulate fatty liver with variable T2. Single-voxel 1H MRS was conducted with multiple TE values, and percent lipid content (lipid%) was determined at each TE to assess accuracy and TE dependency. Concurrently, T2 and equilibrium values of water and lipid were determined separately, and T2 effects on the lipid% were corrected. A similar procedure was conducted in 12 human subjects to determine susceptibility effects on water and lipid MRS signals and lipid%. Multiple measurements were used to test reproducibility. RESULTS: The use of T2-correction was found to be more accurate than uncorrected lipid% in phantom samples (<10% error). Uncorrected lipid% error increased with increasing TE (>20% when TE>24 msec) and with increasing susceptibility effect. In humans, while measurement repeatability was high for both corrected and uncorrected MRS, uncorrected lipid% was sensitive to acquisition TE, with 83.6% of all measurements significantly different than T2-corrected measures (P<0.05). CONCLUSION: Separate T2-correction of water and lipid 1H MRS signals provides more accurate and consistent measurements of lipid%, in comparison to uncorrected estimations. Copyright (c) 2009 Wiley-Liss, Inc.