Both tuberculosis and hepatitis B are endemic in southeast Asia and are common among refugees to the United States from that region. Isoniazid, used for the prophylactic treatment of tuberculosis, is a potentially hepatotoxic drug. Carriers of the hepatitis B virus are likely to have some degree of liver damage due to their chronic infection. We hypothesized that prophylactic treatment of carriers with isoniazid would cause greater liver damage, as measured by serum alanine aminotransferase (ALT) levels, than would such therapy of noncarriers. Cross-sectional and longitudinal studies of the southeast Asian refugee population in Philadelphia failed to support this hypothesis. Isoniazid did not cause greater hepatotoxicity in hepatitis B carriers than in noncarriers. Although carriers had higher ALT levels than noncarriers, both groups experienced transient ALT elevations during the first 2 months of isoniazid prophylactic therapy. Therefore, we concluded that chronic infection with hepatitis B virus is not a contraindication to the prophylactic use of isoniazid.