To understand the natural history of chronic hepatitis B virus infection in children, we studied factors affecting the clearance of hepatitis B e antigen (HBeAg). One hundred sixty-nine apparently healthy children whose sera were positive for HBeAg and hepatitis B surface antigen (HBsAg) and who were recruited by screening were followed prospectively to delineate the HBeAg clearance rate. Another 59 carrier children visiting the outpatient clinic because of symptoms or abnormal liver function were studied for comparison. The annual HBeAg clearance rate was low (less than 2%) during the first 3 years of life but increased with age. The HBeAg clearance rate in children older than 6 years of age was lower in those whose mothers had HBsAg positivity (14.3%) than in those whose mothers had no detectable HBsAg (35.3%). Children who were brought for medical care had higher HBeAg clearance rates (42.4%) than those who were recruited by screening (14.6%) because immune clearance of hepatitis B virus and hence HBeAg often led to hepatocellular damage manifested by abnormal liver function profiles or by symptoms that had caused the parents to seek medical care for their children. We conclude that age, source of subject recruitment, and maternal HBsAg status are important factors affecting HBeAg clearance rate in HBsAg carriers.