Chronic hepatitis B virus (HBV) infection is a common infectious disease in the world. Two percent of the patients with chronic HBV infection will develop cirrhosis each year, and will die prematurely from cirrhosis or hepatocellular carcinoma. So far interferon alfa and lamivudine are the only effective drugs. Interferon alfa can be used at the dosage of 9–10 million units thrice a week for 4–6 months either intramuscularly or subcutaneously for standard treatment. Interferon provides sustained response in 1/3 of the patients when HBe Ag is (+). Response rate to interferon therapy in HBe Ag(−) patients was similar to that reported in HBe Ag(+) ones. However the responses were not sustained in many patients, serum HBV-DNA reappear in most after stopping the treatment. Extension of therapy to 1 year may be needed in patients who are unresponsive to therapy and having HBV-DNA levels <10 pg/ml and ALT >100 IU. Establishment of unresponsiveness in early phases of the therapy is important and careful follow up of serum HBe Ag may be helpful. Interferon alfa treatment of chronic HDV infection may result in temporary normalization of ALT values. Disappearance of HBV-DNA and HBs Ag from the serum upon completion of therapy dictates sustained response in chronic HDV infection. The long term effect of interferon with respect to virological and histopathological responses is poor in HDV infection and longer periods of therapy in higher doses may be beneficial.