OBJECTIVE To evaluate the in vitro anti-HBV activity of recombinant human IFN-gamma, alone and in combination with lamivudine. METHODS A recombinant baculovirus-HBV/HepG2 culture system was developed which could support productive HBV infection in vitro. Expression of HBsAg and HBeAg in infected HepG2 culture medium was detected by commercial enzyme immunoassays. HBV DNA replication intermediates were detected in infected cells by Southern hybridization and viral DNA load was determined by dot hybridization. RESULTS IFN-gamma at 0.1 to 5 microg/L efficiently down regulated HBsAg expression in transduced HepG2 cells. At 5 microg/L, IFN-gamma also suppressed HBV DNA replication in these cells. While treatment with a combination of lamivudine and IFN-gamma showed no additive effect, sequential treatment first with lamivudine and then IFN-gamma was found to be promising. In this culture system the best HBV suppression was observed with a pulse of 2 micromol/L lamivudine for two days, followed by 1 microg/L IFN-gamma for another four days. Compared to treatment with lamivudine alone, the sequential use of 0.2 micromol/L lamivudine for two days, followed by 5 microg/L IFN-gamma for six days showed a 72% reduction in HBV cccDNA pool. CONCLUSIONS This in vitro study warrants further evaluation of a combination of IFN-gamma and lamivudine, especially in IFN-alpha non-responder chronic hepatitis B patients. A reduced duration of lamivudine treatment would also restrict the emergence of drug-resistant HBV mutants.