Chronic hepatitis B virus (HBV) infection is a serious public health burden, and current therapies cannot achieve satisfactory cure rate. There are high unmet medical needs of novel therapeutic agents with differentiated mechanism of action (MOA) from the current standard of care. RG7834, a compound from the dihydroquinolizinone (DHQ) chemical series, is a first-in-class highly selective and orally bioavailable HBV inhibitor which can reduce both viral antigens and viral DNA with a novel mechanism of action. Here we report the discovery of RG7834 from a phenotypic screening and the structure-activity relationship (SAR) of the DHQ chemical series. RG7834 can selectively inhibit HBV but not other DNA or RNA viruses in a virus panel screening. Both in vitro and in vivo profiles of RG7834 are described herein, and the data support further development of this compound as a chronic HBV therapy.