The role of viral factors in the pathogenesis of chronic hepatitis C is unknown. The objective of the present study was to characterize markers of hepatitis C virus (HCV) infection and replication in liver biopsy specimens obtained from 65 genotype 1-infected subjects, including 31 who were coinfected with human immunodeficiency virus (HIV), and to analyze associations between intrahepatic viral markers and hepatitis C disease severity. The percentages of liver cells harboring HCV genomes (%G) and replicative-intermediate RNAs (%RI) were evaluated using strand-specific in situ hybridization, while HCV core and NS3 antigens were assessed by immunocytochemistry. HIV-positive and HIV-negative subjects had similar mean grades and stages of liver disease and had similar indices of HCV infection and replication in liver, even though coinfected subjects had significantly shorter mean disease duration (P = 0.0003). Multivariate analysis showed that %G was not associated with grade or stage of liver disease (P = 0.5 and 0.4, respectively), while %RI was strongly associated with liver inflammation (P < 0.001), liver fibrosis (P < 0.001), and serum alanine aminotransferase levels (P = 0.01). NS3 antigen (but not core) was more frequently detected in HCV RI-positive versus RI-negative specimens (P = 0.028). These findings demonstrate a link between HCV proliferation and hepatitis C disease severity and suggest similar pathogenic mechanisms in HIV-positive and HIV-negative individuals.