Woodchucks infected with woodchuck hepatitis virus (WHV) have profiles of liver disease and age-dependent rates of progression to chronic hepatitis (CH) comparable with those seen in human hepatitis B. The mechanism of recovery from acute hepadnaviral infection or its evolution to chronicity remains unknown, although the liver immune responses are expected to play an important role. To determine the dynamics of intrahepatic cytokine expression and T-cell involvement, and to assess their value in predicting the outcome of acute hepatitis (AH) in the adult onset of WHV infection, we evaluated liver transcription of interferon gamma (IFN-γ); tumor necrosis factor α (TNF-α); interleukins (IL)-2, -4, and -6; and the T-cell influx in relation to disease histologic severity and virus load in serial liver biopsies collected during the life span of experimentally infected woodchucks. Our results show that recovery from viral AH in adulthood is preceded by a significantly greater hepatic expression of IFN-γ and CD3, an increased TNF-α transcription, lower hepatic WHV load, and a greater degree of liver inflammation than those in acute infection with CH outcome. Furthermore, we have learned that the elevated IFN-γ, TNF-α, and CD3 expression in the liver endures for years not only in CH, but also, although to a lesser extent, in apparently completely resolved infection. This is consistent with our previous findings that residual WHV replication and remnant liver inflammation continue for life after recovery from AH. This study indicates that antiviral cytokines, in particular IFN-γ, may play a central role in the long-term control of occult hepadnavirus persistence in the liver.