Weak or absent virus-specific CD8 T-cell responses to hepatitis B virus (HBV) infection are thought to be responsible for persistent HBV infection. Previous studies have indicated that multiple inhibitory receptors, including lymphocyte activation gene-3 (LAG-3), can suppress the CD8 T-cell response in chronic viral infection. This study aimed to detect LAG-3 expression and to investigate the manner in which the immune response is regulated to balance the strength of the response with the extent of liver injury in chronic HBV infection. The results showed that LAG-3 expression levels were significantly higher in CD8 T cells from chronic hepatitis B patients in the immune-active phase compared with chronic asymptomatic HBV carriers and healthy controls. CD8 T-cell function was suppressed in cells with high LAG-3 expression, and these cells exhibited reduced interferon-γ (IFN-γ) secretion. Furthermore, IFN-γ secretion was restored in CD8 T cells that were treated with a specific antibody to LAG-3. Taken together, liver injury was prominent in the immune-active phase, but suppressing T-cell function could mitigate this damage. Importantly, the inhibitory function of LAG-3 can be blocked using a LAG-3-specific antibody, and this can restore the activity of non-functional T cells.