Background <p>Fuzheng Huayu formula (FZHY) has been extensively applied in clinical for liver fibrosis treatment in China, its therapeutic potential in cholestatic liver injury remains underexplored.</p> Objective <p>To evaluate the protective effects and underlying mechanisms of FZHY against chronic cholestatic liver injury.</p> Methods <p>The therapeutic effect of FZHY was initially validated in a 3,5-diethoxycarbonyl-1,4-dihydrocollidine (DDC)-induced murine model of chronic cholestasis. Subsequent mechanistic investigations were conducted through comparative analyses in peroxisome proliferator-activated receptor α gene knockout (<i>Pparα</i>^−/−) mice subjected to DDC challenge.</p> Results <p>FZHY significantly ameliorated chronic cholestatic liver injury phenotypes in DDC-induced mice, as evidenced by bile acids (BAs) accumulation, inflammation, ductular reaction and biliary fibrosis was remarkably reduced after treatment with FZHY. Transcriptome sequencing analysis revealed that the effect of FZHY on chronic cholestatic liver injury was closely associated with activating PPAR signaling pathway and suppressing nuclear factor kappa-B (NF-κB) signaling. Further research found FZHY did not only enhance the total hepatic content of PPARα protein, but also increased its nuclear to cytoplasmic ratio that was reduced by DDC inducing. Additionally, FZHY suppressed hepatic phosphorylation of IκBα and NF-κB. The therapeutic effect of FZHY in treating DDC-induced mice with chronic cholestatic liver injury is similar to that of fenofibrate, a PPARα agonist. Crucially, genetic ablation of <i>Pparα</i> substantially abrogated the hepatoprotective and anti-fibrotic effects of FZHY in DDC-induced mice.</p> Conclusions <p>The present study underscores FZHY regulated BAs metabolism and alleviated hepatic inflammation and fibrosis by upregulating PPARa in DDC-induced mice. Our study provides novel insights that FZHY might be a promising drug for chronic cholestatic liver injury.</p> Graphical Abstract <p></p>