A translational stop in the hepatitis B virus (HBV) precore codon 28 and specific changes in the core promoter region of the X gene have been suggested to influence the level of circulating HBeAg in patients. We analysed the core promoter region and precore sequences from 59 HBV strains (including 14 from the databank) of different genotypes and from patients with different HBeAg/anti-HBe patterns. The initiator and TATA elements for transcription of precore and pregenomic RNA were highly conserved. The majority of X gene deletions in the core promoter region would lead to translational frame-shifts and stops, truncating the C-terminal end of the X protein. We found significant associations between specific changes in core promoter positions 1762 to 1764, or in precore codon 28, and absence of circulating HBeAg. For the core promoter mutations alone, this association was related to the apparent degree of liver damage (as estimated by alanine aminotransferase levels) at the time of sampling. Mutations at nucleotides 1762 and/or 1764 were often accompanied by point mutations at positions 1751 to 1755. Since mutations at nucleotide positions 1762 and 1764 have recently been shown by in vitro studies to suppress HBeAg production with a concomitant enhancement of virus production, disappearance of the HBeAg-positive phenotype associated with 1762 to 1764 mutations may thus have at least as much significance for the course of infection as HBeAg absence associated with precore codon 28 stop mutations. These observations are considered against a secondary structural model for the 3' end of HBV pregenomic RNA which also predicts enhancement of virus replication after mutation at positions 1762 and 1764.