The immediate goals of hepatitis B virus (HBV) therapy are to suppress the histologic progression of the disease and diminish infectivity. Although many drugs have been used in the treatment of this condition, only interferon has proven to be consistently effective. The ideal candidate for interferon therapy is a patient who has a high baseline aminotransferase level and a low HBV DNA level. Responders to interferon therapy usually demonstrate an alanine aminotransferase (ALT) flare to at least twofold the baseline value during the second or third month of therapy, indicating that the patient has become immunologically activated. Low baseline ALT levels before treatment (i.e., < 100 U/liter) are associated with a low response rate. An improvement in response rates occurs when patients with low ALT levels are primed with a short course of prednisone. Piecemeal necrosis markedly improves within a short time after a response is achieved, although residual portal tract inflammation often is demonstrated on biopsy. The loss of HBV DNA and hepatitis B e antigen is generally maintained after interferon therapy, but relapse occurs in approximately 10% of the patients. Further studies with interferon are indicated in multiple patient groups.