The woodchuck hepatitis virus (WHV) is taxonomically and serologically related to the hepatitis B virus (HBV). Infection with each of these viruses is associated with acute and chronic hepatitis and hepatic cell carcinoma in their respective hosts and these associations appear to be etiological in nature. Thus, WHV infection of woodchucks provides a relevant and convenient model for understanding HBV infections of humans. Five major areas of study were pursued this year. First, we continued our investigations of the WHV X gene and found that this gene is very sensitive to alterations and is essential for viral replication in animal transfection experiments. Second, fine mapping of the X transcript promoter was used to identify the essential nucleotides in this cis- acting element. Third, we extended our previous experiments on the characterization of the bi-directional promoter of WHV. Fourth, progress was made in an attempt to identify a Mongolian marmot hepatitis virus. Fifth, two WHV isolates were shown to develop surface antigenemia and liver tumors at significantly different rates. The latter finding has important implications for understanding the molecular mechanisms involved in viral replication and in the oncogenic potential of hepadnaviruses. Thus, it is now possible to design experiments to understand the mechanism of hepadnavirus oncogenesis.