Data on the long-term effects of interferon alfa (IFN) treatment on disease progression and mortality in patients with chronic hepatitis B (CHB) are limited. To evaluate factors that influence clinical outcome and survival, we performed a follow-up study on 165 hepatitis B e antigen (HBeAg) positive CHB patients treated with IFN between 1978 and 2002. The median IFN dose was 30 megaunits (MU)/week (range, 2–70 MU/week), and the median duration of therapy was 16 weeks (range, 1–92 weeks). Response to treatment was defined as HBeAg loss within 12 months after the end of IFN therapy. Median follow-up was 8.8 years (range, 0.3–24 years). Fifty-four patients (33%) responded to IFN treatment. Relapse (HBeAg reactivation) occurred in 7 of the 54 (13%) responders. Fifty-two percent of the responders lost hepatitis B surface antigen (HBsAg) as compared with 9% of the nonresponders (P < .001). Liver histology showed a decreased necroinflammatory activity and less progression of fibrosis in responders. Twenty-six patients died during follow-up. Hepatocellular carcinoma (HCC) was found in 8 patients, 6 of whom were nonresponders. Of the two responders who developed HCC, one patient had relapsed after discontinuation of therapy. Multivariate analysis showed significantly improved survival (relative risk (RR) of death 0.28, 95% CI 0.10–0.78) and reduced risk of developing HCC (RR 0.084, 95% CI 0.09–0.75) in responders. In conclusion, response to IFN therapy results in a prolonged clinical remission with an increased rate of HBsAg seroconversion and improved liver histology. Our results indicate that after correction for baseline factors, response to IFN therapy increases survival and reduces the risk of developing HCC. (HEPATOLOGY 2004;39:804–810.)