Infants born to hepatitis B e antigen (HBeAg)-positive hepatitis B virus (HBV) carrier mothers invariably become persistently infected. To investigate the role of immunologic tolerance mechanisms in chronic infection of the newborn, we have generated HBeAg-expressing transgenic mice (B10.S-Tg31e). These mice were tolerant to both HBeAg and the nonsecreted HBcAg at the T-cell level. Furthermore, nontransgenic littermates born to HBeAg-expressing mothers showed lowered T-cell responses to HBc/HBe antigens, suggesting that tolerogenic HBeAg may cross the placenta. Tg mice did not produce antibody to HBeAg but did produce immunoglobulin M (IgM) antibodies to HBcAg via a T cell-independent pathway. The coexistence of tolerance to HBc/HBe T-cell determinants and production of antibody to HBcAg in vivo parallels the immunologic status of neonates born to carrier mothers. These observations suggest that expression of HBeAg may represent a viral strategy to guarantee persistence after perinatal infection. Further studies in F1 hybrid Tg mice (B10 x B10.S-Tg31e) illustrated that ''self'' tolerance to HBeAg is variable, depending on the major histocompatibility complex (MHC) genotype. A proportion of T cells recognizing e129-140 in the context of I-A(b) evade induction of tolerance, persist in the periphery, and can be activated in vivo by a single injection of the 12 residue T-cell self-peptide. Furthermore, the self-reactive T cells can cooperate with self-reactive, HBeAg-specific B cells to mediate in vivo production of autoantibody sufficient to neutralize detection of the autoantigen in serum. This model illustrates that T cells specific for an immunogenic T-cell site on a nonsequestered autoantigen can escape induction of tolerance (i.e., they are not deleted or anergic) and, more important, can mediate autoreactivity in vivo. These murine studies suggest that chronic HBV (CH-B) carriers may also possess ''quiescent'' T cells that have evaded tolerance induction. In order to examine the relevance of this murine model, the sera of 200 HBeAg-positive CH-B carriers were analyzed with novel assays capable of detecting serum anti-HBe and anti-HBs antibodies regardless of the simultaneous presence of their respective antigens. The results redefine the serology of CH-B infection. The serological data also agree with the hypothesis that T-cell tolerance to HBeAg plays a role in chronicity and that HBeAg-specific T cells emerging from the tolerant state mediate liver injury and HBV clearance in CH-B infection.