The incidence of hepatitis B virus (HBV) infections during the second and third year of life was determined for 105 children whose mothers were carriers of hepatitis B surface antigen. Children were given hepatitis B immune globulin (HBIG) at birth and in some instances three and six months later to protect against HBV infection. Passive antibodies from the dose of HBIG disappeared in three to four months. Infants negative for HBV markers at 12 months were selected and subsequent infections were analyzed in relation to the e system markers in the mother. Over an average of 17.5 months of follow-up, 38.1% of the infants became infected, an annual incidence rate of 26.0%. The rate was highest for children whose mothers were positive for hepatitis B e antigen (HBeAg) (57.1%), moderate for those whose mothers were negative for both HBeAg and antibody to HBeAg (anti-HBe) (20.4%), and lowest for those whose mothers were positive for anti-HBe (11.3%).