To explore the demographic composition of type 2 diabetes mellitus (T2DM) with metabolic associated fatty liver disease (MAFLD) and the role of energy metabolism in the progression of MAFLD in order to provide theoretical support for improving the prognosis of MAFLD. A cross-sectional study was conducted. Ninety-four cases with T2DM combined with MAFLD admitted to the Endocrinology Department of Tianjin Third Central Hospital from July 2014 to July 2019 were selected. Patients were divided into three groups: non-metabolic associated steatohepatitis (MASH) group (25 cases), borderline MASH group (49 cases), and MASH group (20 cases) according to the non-alcoholic fatty liver disease activity score (NAS). Patients were further divided into two groups: non/mild fibrosis (F0-1) group (74 cases) and the significant fibrosis (F2-4) group (20 cases) in accordance with liver fibrosis scores. The differences in general clinical and biochemical indicators, body composition, and energy metabolism indicators among the groups were compared. Binary logistic regression analysis was conducted to explore factors affecting liver inflammation and fibrosis severity degree in patients with MAFLD. The visceral fat area (VFA) and body fat percentage (PBF) were significantly higher in the MASH group than in the non-MASH group (<0.05), while the skeletal muscle mass index and body mass index (SMI-BMI) were significantly lower in the MASH group than in the marginal MASH group (<0.05) during the comparison of body composition and substrate metabolism at different stages of MASH. Alanine aminotransferase (ALT) and homeostasis model assessment of insulin resistance (HOMA-IR) were significantly higher in the fibrotic group than in those in the no/mild fibrosis group (<0.05) when comparing clinical and biochemical indicators, body composition, and substrate metabolism at different stages of fibrosis. The skeletal muscle mass (SMM), SMI-BMI, SMM-Weight, resting energy expenditure (REE), and fat oxidation rate (FAT) were significantly lower in the fibrotic group than those in the no/mild fibrosis group (<0.05). The respiratory quotient and carbohydrate functional ratio (%CHO) were significantly higher in the fibrotic group than in the no/mild fibrosis group (<0.05). Correlation analysis indicated a positive correlation between the NAS score, reflecting the severity of liver inflammatory lesions, with VFA and PBF (=0.258 and 0.323, <0.05); while the F score was positively correlated with the respiratory quotient, %CHO, and VFA (=0.292, 0.303, and 0.239, <0.05), and negatively correlated with REE, the energy ratio from fat, FAT, SMM, SMI-Weight, and SMI-BMI (=-0.209, -0.214, -0.333, -0.240, -0.250, and -0.305, <0.05). Logistic regression analysis indicated that SMI-Weight and FAT were independent factors affecting the progression of liver fibrosis. The reduction of skeletal muscle, particularly because of energy metabolism, is a factor affecting the progression of fibrosis in MAFLD.