A cohort of patients with chronic type B hepatitis is being evaluated and followed prospectively to determine the long-term natural history of this common form of chronic liver disease. Selected patients have been entered into therapeutic trials in which antiviral or immunomodulatory agents are being administered. Several agents have been evaluated including alpha interferon, ribavirin, and fluoro-iodo arabinofuranosyl- uracil (FIAU). Alpha interferon continues to be evaluated in atypical or unusual patients who would ordinarily excluded from controlled trials including those with decompensated cirrhosis, extra-hepatic complications of hepatitis B and atypical serologic markers. A controlled trial of interferon in children with hepatitis B is underway. To date, xx patients have been enrolled. None have completed the study. Two pilot studies of FIAU, a nucleoside analogue, have been conducted. In the first, dose-finding, study 24 patients were treated FIAU at doses of 0.05, 0.1, 0.25 and 0.5 mg/kg/day orally for 4 weeks. FIAU therapy was associated with marked suppression (85% decrease) of serum HBV DNA levels after 4 weeks of therapy. Levels of HBV DNA often remained suppressed for prolonged periods after stopping FIAU. Two patients cleared hepatitis B epsilon antigen from serum; hepatitis subsequently relapsed in one of these patients. In a second study of FIAU, designed for patients to receive therapy for 6 months, 15 patients eneterede the study. Severe side effects of the drug became apparent in 7 patients after taking the drug for 8 to 12 weeks. These patients appeared to develop a Reye's-like syndrome which is currently being investigated further. This study was discontinued because of toxicity.