To gain new insights into the pathogenesis of hepatitis B virus–induced chronic liver disease, we have used nonisotopic in situ detection methods for the simultaneous analysis of hepatitis B virus DNA and antigens at the single-cell level. Paraffin-embedded liver specimens from 23 cirrhotic patients (12 HBsAg positive and 11 HBsAg negative) who underwent liver transplantation were evaluated by in situ hybridization with a digoxigenin-labeled DNA probe and digoxigenin detection system and by immunohis-tochemistry with an enhanced biotin-streptavidin technique. DNAs extracted from liver and serum specimens were analyzed by Southern- and slot-blot hybridization, respectively. Using the in situ techniques, we detected hepatitis B virus–specific DNA and antigens in 11 of 12 HBsAg-positive patients and in none of the 11 HBsAg-negative individuals. Replicative intermediates of hepatitis B virus DNA were detected by Southern-blot analysis in the same 11 HBsAg-positive patients, 6 of whom had no serological markers of hepatitis B virus replication. Therefore a good correlation was found between the results obtained by the in situ and Southern-blot hybridization analyses of tissue specimens. However, a lack of correlation was found between serum- and tissue-associated markers of viral replication. In addition, the simultaneous in situ detection analyses revealed that some hepatocytes containing high levels of viral DNA were devoid of detectable HBcAg, suggesting a mechanism by which the virus may escape immunological surveillance. These data provide evidence that liver-associated HBV replication may persist in the absence of serological markers of active hepatitis B virus replication in cirrhotic patients with advanced liver disease and demonstrate that the evaluation of liver- rather than serum-associated markers of viral replication provides a more accurate assessment of the virological events occurring in HBsAg-positive individuals. (HEPATOLOGY 1993;18:1032-1038).