A novel class of hepatitis B virus mutants in patients with chronic hepatitis B is described. The predicted effect of the mutations is to disrupt the X open reading frame. The location of the genetic alterations within the putative precore promoter also suggests that they may ameliorate precore transcription, which would provide an alternate mechanism for HBeAg(-) escape variation. Definitive conclusions regarding the effects of these mutations must await additional in vitro and in vivo studies.