Forty chronic untreated paediatric carriers of hepatitis B virus (HBV) infection, with no other causes of liver disease, were biopsied on presentation, when the disease was in the active viral replication phase. After a period ranging from 1 to 13 years, all patients underwent a control biopsy. At the time of the last biopsy, 31 of the patients were anti-HBe positive, whereas 9 persisted in the active replication phase. In this latter phase, necrotic and inflammatory lesions and the presence of nuclear HBcAg were found significantly more frequently than when replication had terminated. The necrotic and inflammatory lesions detected in the first biopsy of patients who subsequently underwent antiHBe seroconversion were significantly more severe than in patients failing to reach seroconversion. All patients who maintained viral replication showed generalized nuclear reactivity for HBcAg on presentation; such reactivity was also found in 16 of 31 (52%) patients who reached anti-HBeAg seroconversion. All these cases had piecemeal necrosis (PMN) in the biopsy. PMN may therefore be considered as a positive prognostic factor in that it identifies those patients who may seroconvert with significant remission of liver disease