The cellular localization of the precore/core and core proteins was studied by immunofluorescence following transfection of 143 thymidine kinase-negative (TK ) and Hep-G2 cells with expression constructs containing wild-type (hepatitis B e antigen [HBeAg]-positive) and precore mutant (HBeAg-negative) sequences. Precore/core constructs with the wild-type phenotype result in strong nuclear staining, while, in contrast, constructs expressing core antigen alone have strong cytoplasmic staining. These differences in the pattern of immunofluorescence staining may be caused by expression of the precore/core protein, some of which may be translocated into the nucleus, following removal of the signal peptide. In vitro translation experiments showed that the main protein products obtained in the presence of microsomal membranes were the precore/core protein and a truncated product representing the same protein without its signal peptide. Core protein expression from the precore mutant constructs was very much reduced, indicating that translational re-initiation was not very efficient. The significance of the precore/core protein being present in the nucleus is not clear, but suggests that it may be important in the replicative cycle of the virus. Finally, HBeAg produced by some of the constructs could not be detected because amino acid substitutions affected antibody-binding epitopes.