Patients chronically infected with hepatitis C virus (HCV) are at risk of developing end-stage liver disease and hepatocellular carcinoma. Development of drugs to inhibit hepatocyte damage and a vaccine against HCV is hampered by the lack of a small animal model. We generated mice in which the viral genome RNA was always present in the hepatocytes using a special transgene. Here we show that the HCV genome RNA transcribed by Pol I polymerase can replicate and produce infectious viruses in mice. We obtained a transgenic mouse with 200 copies per haploid which we named the A line mouse. It produced ~ 3 × 10(6) HCV RNA copies/mL serum, which is at the comparable level as patients with chronic HCV infection. This mouse was immunotolerant to HCV and showed hepatic steatosis without any necroinflammation at the age of 6 months or hepatocellular carcinoma at the age of 15 months. Thus, the A line mouse can be used as an animal model for chronic HCV infection. This will enable better study of the abnormalities in metabolism and signal transduction in infected hepatocytes, and development of drugs that cure abnormalities.