More than 500 million people world-wide suffer from viral hepatitis which can be caused by a variety of distinct infectious agents. The spectrum of disease, which ranges from acute self-limited hepatitis to liver cirrhosis, not only reflects the different biological properties and pathogenicity of the hepatitis viruses, but is also the result of the specific interaction between each virus and the immune system of the infected host. The immune response plays a crucial role in the elimination of the infecting virus as well as in disease pathogenesis and is described in detail for acute and chronic hepatitis B and C virus infection. Acute hepatitis B virus infection is characterized by a vigorous, polyclonal cytotoxic T lymphocyte response against HBV that is not readily detectable in patients with chronic hepatitis B, suggesting that resolution of disease is mediated by the HBV-specific CTL response in these patients. Because traces of virus as well as HBV-specific CTL can perist for decades after clinical recovery, continuous priming of new CTL by minute traces of virus is thought to protect from reactivation of disease. In contrast, the hepatitis C virus causes chronic liver disease despite a polyclonal and multispecific immune response, suggesting that distinct immunological and viral mechanisms determine the different clinical outcome of HBV and HCV infection. Their implications for the development of immunomodulatory vaccines to cure patients with chronic viral hepatitis are discussed.