Integrated hepatitis B virus (HBV) DNA is almost invariably found in hepatocellular carcinomas (HCC) which develop in HBV carriers. Integrated HBV DNAs from two single-integration HCCs (C3 and C4) have been cloned, and the cellular integration sites have been analyzed. Integrated HBV DNA of C3 is present in chromosome 6 and contains a nearly complete linear HBV genome. The HBV DNA integration in tumor C3 was not associated with major rearrangements of cellular DNA. In contrast, the integrated HBV DNA in C4 contains a large inverted repeat of HBV DNA, in which each repeat consists of a linear HBV DNA segment similar to that present in C3. The C4 integration was also accompanied by a cellular DNA translocation at the HBV integration site. The translocation occurred between chromosomes 17 and 18, along with a deletion of at least 1.3 kilobases of chromosome 18 DNA at the translocation site. Our data support a model in which postintegration rearrangement of integrated HBV and cellular DNA results in the generation of chromosomal aberrations. These chromosomal aberrations may function in a multistage mechanism leading to fully malignant HCC.