Chronic hepatitis B virus (HBV) infection is one of the most common persistent virus infection in man. It causes significant morbidity and mortality, and therefore is important. Extensive studies on clinicopathologic studies and long-term follow up on hepatitis B surface antigen (HBsAg) carriers have largely disclosed the natural history of chronic HBV infection. The infection easily becomes chronic when contracted in early infancy. As high as 90% of babies born to HBV carrier mothers will also become HBsAg carriers. Once chronic infection is established, it is refractory, and HBsAg carriage usually persists for life. However, the chronic infection is not monotonous, it actually evolves from an HBV replicative phase to a non-replicative phase. The host responds differently and with more complexity in different phases. The virus-host interactions, divided into three phases, virus tolerance, virus clearance and residual HBV integrated phases, result in a heterogeneous variety of hepatic lesions. The first two phases occur when HBV is actively replicating, and the last corresponds to the non-replicative phase. The high HBV level (and hence HBV gene products) renders the host's immune system tolerant to the virus, and the infected host does not exert an effort to get rid of the virus. At this stage, the liver is nearly normal, and the host is asymptomatic. However, later in the replicative phase, the HBV replication begins to wane, and the immune tolerance is no longer maintained.(ABSTRACT TRUNCATED AT 250 WORDS)