Hepatitis frequently recurs after liver transplantation for hepatitis C. However, the histological progression of disease, predictors of recurrence and disease severity, and patient survival remain uncertain. Fifty-five patients with cirrhosis caused by chronic hepatitis C underwent liver transplantation between January 1990 and December 1993. Hepatitis C genotype was determined, and liver biopsies were performed at frequent intervals posttransplantation. The median follow-up time was 40.4 months. The cumulative rate of survival was no different in liver transplant recipients for hepatitis C than in liver transplant recipients for other chronic liver diseases (P = .62). Histological recurrent hepatitis C developed in 33 of 50 patients assessable for disease recurrence; the median recurrence-free survival time was 13.4 months. Histological activity and stage were mild in most cases. Only 2 patients developed cirrhosis, and no patient required a second transplantation for recurrent disease. Patients with acute cellular rejection had a shorter recurrence-free survival (P = .0141). In patients with recurrent hepatitis, rejection also was correlated with increased histological grade 2 years after transplantation (P = .0061). Recurrence-free survival was decreased in patients infected with genotype 1 (1a and 1b combined) compared with genotypes 2 and 3 combined (P = .02), whereas there was no difference between genotypes 1a and 1b (P > .80). Only patients infected with genotype 1a or 1b developed bridging fibrosis or cirrhosis. In addition, patients who had an early recurrence had a greater risk of progressing to bridging fibrosis or cirrhosis (hazard ratio, 5.1; P = .0473). In our experience, recurrent hepatitiS C after liver transplantation in most cases is mild and survival is unaffected. Both acute cellular rejection and infection with genotype 1 are independent risk factors for reduced recurrence-free survival, and early recurrence is associated with a higher risk of disease progression.