The aim of the study was to estimate the prevalence of HBeAg defective mutants among patients with chronic hepatitis B (CHB) in the United States and to study the effect of interferon-alpha (IFN-alpha) on determining the occurrence of mutations in the HBV precore and proximal core regions. Twenty CHB patients who were treated with IFN-alpha were studied. Initially, all were HBV DNA positive by dot-blot hybridization; 17/20 were HBeAg positive, and 3/20 were anti-HBe positive. The precore (87 nt) and proximal core (81 nt) regions were sequenced after PCR amplification by the dideoxy chain termination method. In pretreatment sera, 15/20 patients harbored wild-type HBV only, while in 5/20 at least one nucleotide substitution was found. Mutations that prevent HBeAg synthesis were found in three patients, all of whom had G-to-A substitution at nt 1896 and two of them were anti-HBe positive. Follow-up sera were available in 18 patients. With respect to pretreatment specimen, 15/18 patients had no changes in the sequenced regions after therapy. Sequence changes were observed in the remaining three patients: In one an HBeAg defective strain was replaced by a wild-type strain; in the second a wild-type strain was replaced by an HBeAg defective strain; and in the third two mutations changing the deduced amino acid sequence of the core protein developed in the wild-type strain. In conclusion, most of our patients (85%) were initially infected by HBV strains having no mutations that prevented HBeAg synthesis. IFN-alpha therapy infrequently resulted in the appearance of mutations in the precore and proximal core regions.