Hepatitis B virus (HBV) replicating in patients with serum hepatitis B surface antigen and antibody to hepatitis B e antigen (cryptic HBV replication) can be detected by a spot hybridization technique for serum HBV-DNA and by immunoperoxidase staining of hepatitis B core antigen in the liver. These methods allowed us to study the effects of chronic (13 to 82, mean 30 months) administration of low doses (10 or 15 mg/day) of prednisone to 17 patients with chronic active hepatitis and cryptic HBV replication. Liver biopsies performed before treatment demonstrated that 1 to 50% (mean 12%) of the liver cells were infected. After therapy, infected cells had disappeared in 5 (29%), were considerably reduced in 9 (53%) and remained unchanged in 3 (18%) patients. The mean percentage of infected cells in the liver biopsies performed at the end of the follow-up was 3.2 +/- 5.5% (p less than 0.005). Serum HBV-DNA was present in 12 of 13 and in 5 of 12 patients investigated before treatment and at the end of the study, respectively. Five patients harboring HBV in the liver developed cirrhosis during treatment. Our data indicate that, despite steroid therapy, HBV replication either ceased or was decreased in two thirds of the patients, while in no case it flared-up. The rise of cirrhosis was not prevented by this type of therapy.