Alpha interferon (IFN-alpha) and pegylated IFN-alpha (pegIFN-alpha) are used for the treatment of chronic hepatitis B (CHB). Unfortunately, only a minority of patients can be cured. The mechanisms responsible for hepatitis B virus (HBV) resistance to pegIFN-alpha treatment are not known. pegIFN-alpha is also used to treat patients with chronic hepatitis C (CHC). As with chronic hepatitis B, many patients with chronic hepatitis C cannot be cured. In CHC, IFN-alpha signaling has been found to be inhibited by an upregulation of protein phosphatase 2A (PP2A). PP2A inhibits protein arginine methyltransferase 1 (PRMT1), the enzyme that catalyzes the methylation of the important IFN-alpha signal transducer STAT1. Hypomethylated STAT1 is less active because it is bound by its inhibitor, PIAS1. In the present work, we investigated whether similar molecular mechanisms are also responsible for the IFN-alpha resistance found in many patients with chronic hepatitis B. We analyzed the expression of PP2A, the enzymatic activity of PRMT1 (methylation assays), the phosphorylation and methylation of STAT1, the association of STAT1 with PIAS1 (via coimmunoprecipitation assays), the binding of activated STAT1 to interferon-stimulated response elements (via electrophoretic mobility shift assays), and the induction of interferon target genes (via real-time RT-PCR) in human hepatoma cells expressing HBV proteins as well as in liver biopsies from patients with chronic hepatitis B and from controls. We found an increased expression of PP2A and an inhibition of IFN-alpha signaling in cells expressing HBV proteins and in liver biopsies of patients with CHB. The molecular mechanisms involved are similar to those found in chronic hepatitis C.