Serum glutamic oxaloacetic transaminase and gamma globulin levels were correlated with morphologic findings during and after corticosteroid therapy of severe chronic active liver disease to assess ability to monitor histologic change. Morphologic features were interpreted by a single observer from 441 coded biopsy specimens obtained from 69 patients. Serum glutamic oxaloacetic transaminase values were more predictive of histologic findings than gamma globulin levels (p less than 0.02), correctly reflecting morphologic status in 67% of instances during treatment and 80% after treatment. Abnormalities in either test identified chronic active liver disease with similar accuracy, but serum glutamic oxaloacetic transaminase determinations were more sensitive to active inflammation. Serum glutamic oxaloacetic transaminase elevations of more than twice normal during and after therapy were reliably associated with chronic active liver disease. Normal laboratory studies, however, did not detect chronic active liver disease in 55% of cases during treatment and 19% after therapy. The majority of lesions undetected by laboratory investigations comprised periportal necrosis while confluent necrosis was rarely missed. We conclude that serum glutamic oxaloacetic transaminase determinations provide a useful mechanism for monitoring chronic active liver disease. During therapy, serum glutamic oxaloacetic transaminase levels reliably discount resolution, but do not predict histologic inactivity. After treatment, laboratory surveillance inconsistently detects periportal necrosis, but rarely misses severe inflammation of potentially greater prognostic significance.