The states of hepatitis B virus DNA, RNA transcripts and antigens (HBsAg and HBcAg) were studied in the liver with hepatocellular carcinoma by blot hybridization and immunohistological methods. We used whole hepatitis B virus DNA and gene specific probes (S, C and X genes) for hybridization. Integrated viral DNA was found in all five tumors, but episomal DNA was not detected in the neoplastic tissue. In the nonneoplastic cirrhotic liver, episomal DNA was found in four cases and integrated viral DNA in four cases. A large amount of hepatitis B virus-specific RNA transcripts was demonstrated in nonneoplastic liver of all five cases. Two major transcripts, 2.4 and 3.4 kb in length, were identified. The former hybridized with the S gene probe and the latter with the C gene probe, suggesting that they were messenger RNAs for HBsAg and HBcAg, respectively. In contrast to nonneoplastic liver, RNA transcripts were found in the neoplastic portion in only two cases, small in quantity; they primarily hybridized with S and X, but not with C genes. Novel species of 4.0 and 3.9 kb transcripts were found in the neoplastic and the nonneoplastic portions, respectively, in one case. They may represent fusion transcripts of integrated viral DNA and cellular flanking sequences.