A set of nonlinear fluid equations which includes the effect of finite ion Larmor radius is derived to describe microturbulence [k⊥ &rgr;s&bartil;O(1),k∥R&bartil;O(1),n1/n0&bartil; &rgr;s/Ln, andB1/B0&bartil;&rgr;s/R] in an inhomogeneous plasma with a strong magnetic field of general geometry. Here &rgr;sis the ion Larmor radius at the electron temperature,Lnis the density gradient scale length,Ris the radius of curvature of the magnetic line of force,kis the wave vector, andn1/n0andB1/B0are relative levels of density and magnetic field perturbations.