Hepatitis B virus (HBV) variant strains may develop during therapy for chronic infection with the nucleoside analog 2',3'-dideoxy-3'-thiacytidine (3TC). HBV mutants result from isoleucine (I) or valine (V) substitutions in the methionine (M) of the YMDD motif in the viral reverse-transcriptase catalytic domain. In addition, other mutations in the reverse-transcriptase "B domain" involving either a phenylalanine (F)-to-leucine (L) at amino acid 501 (F501L) or an L-to-M substitution at amino acid 515 (L515M) have been observed during 3TC and Famciclovir therapy as well. To determine the biologic consequences of these mutations on viral replication, variant viral genomes were constructed and transiently transfected into hepatocellular carcinoma (HCC) and HEK 293 human embryo kidney-derived cell lines. In transiently transfected HCC cells, the viruses bearing the YI/VDD or F501L mutations had greatly impaired replication as compared to wild-type virus, whereas the virus carrying the L515M substitution showed the least defect. Double mutants with the L515M substitution showed intermediate defect between the YI/VDD or F501L and the L515M single-mutant strains. In contrast, when transfected into HEK 293 cells, the viruses bearing the YI/VDD or L515M mutation replicated as wild-type. However, under conditions of deoxynucleotide depletion produced by hydroxyurea treatment of HEK 293 cells, all mutants but not the wild-type virus exhibited a reduced replication phenotype similar to that observed in HCC cells. In both HCC and HEK 293 cells, the mutant viruses carrying the F501L substitution showed a decreased pregenomic RNA encapsidation level, suggesting that the defect in HBV DNA synthesis occurs at the RNA packaging level. These findings show that 3TC and Famciclovir selected mutations alter the properties of the HBV reverse transcriptase, resulting in impaired viral replication within the cell.