The clinicopathologic features, the natural history, and the prognostic indicators of hepatitis C virus (HCV)-related liver disease in renal allograft recipients have not been well defined. Among 220 renal allograft recipients, 21 were seropositive for HCV RNA, which persisted on prospective follow-up for 40 months. Elevations in alanine aminotransferase and alkaline phosphatase were noted after renal transplantation in 15 (71.4%) and 9 (42.9%) patients, respectively, with 11 (52.4%) showing recurrent or persistent abnormalities. Mortality from liver failure was noted in 1 patient. Persistence of abnormal liver biochemistry was associated with an early onset of biochemical derangement after transplantation, and a longer dialysis duration (P < 0.05). HCV-related liver pathology was assessed in 13 patients by histologic scoring with respect to "hepatitic activity," "bile duct damage," and "architectural abnormality," adding up to a "total" score. Six (46.2%) of 13 initial liver biopsies showed significant chronic liver disease. Liver histology correlated with mean alanine aminotransferase and alkaline phosphatase levels after renal transplantation, and was more severe in patients with persistent biochemical abnormalities. Early onset of abnormal liver biochemistry after transplantation and persistently abnormal biochemistry were independent predictors of worse total and activity scores (P < 0.05). Renal transplant recipients demonstrated lower activity scores when compared with nonimmunosuppressed subjects with chronic hepatitis C (P = 0.03). HCV RNA was detectable in all 23 liver specimens tested. We conclude that significant, potentially life-threatening liver pathology manifests in about half of renal transplant recipients with chronic HCV infection. Liver histology correlates with the longitudinal biochemical profile. Patients with early onset of biochemical abnormalities and persistently deranged liver biochemistry are at risk of developing severe liver disease.