China has one of the highest rates of hepatitis B virus (HBV) endemicity in the world. In a survey of five provinces, the overall HBV infection rate in the general population was found to be 42.6%, with 10.3% testing positive for hepatitis B surface antigen (HBsAg). Higher rates were found in rural than in urban areas. The prevalence of HBsAg among children under 1 year of age is quite low but increases rapidly thereafter, reaching a peak among 5 to 9 year olds. The pattern of age distribution suggests that horizontal transmission is an important route of HBV infection during early childhood, and the proportion of chronic HBsAg carriage attributable to perinatal transmission has been estimated at only 13-20%. Contact with infected family members probably accounts for much of the horizontal transmission in children. In a nationwide survey, 27.2% of families were found to have one or more HBsAg positive members and a strong tendency for family clustering has been identified. The strategy for prevention of HBV infection includes vaccination of all newborns, whether their mothers are HBsAg positive or negative, together with vaccination of high risk populations, and improved control measures in clinics and blood transfusion centres.