Background & Aims: Interrelationship between hepatitis B virus (HBV) replication and the stage of hepatocyte proliferation and differentiation may play an important role in the pathogenesis of HBV infection. The aim of this study was to assess the effect of hepatocyte proliferation and/or cell arrest on HBV replication. Methods: Hepatoblastoma cells transfected with HBV were subjected to serum deprivation or treatment with aphidicolin or camptothecin. Cell cycle analysis was performed using flow cytometry, and cellular DNA synthesis was analyzed by assessing 5-bromo-2'-deoxyuridine incorporation. Distribution of episomal HBV DNA and proliferating cell nuclear antigen in liver specimens was assessed by simultaneous in situ hybridization and immunohistochemistry. Results: Serum deprivation inhibited cellular DNA synthesis and increased levels of HBV messenger RNA (mRNA). Aphidicolin treatment resulted in cell arrest in G(1), with concomitant increases in levels of HBV mRNA and viral DNA. Cell entry into S phase inhibited expression of HBV mRNA. Camptothecin induced G(2) cell arrest and inhibited cellular DNA synthesis with increased amounts of viral replication and levels of HBV mRNA. In vivo studies showed an inverse correlation between expression of proliferating cell nuclear antigen and presence of episomal HBV DNA in individual hepatocytes. Conclusions: HBV replication is cell cycle dependent, supporting the concept of enhanced viral replication in quiescent hepatocytes. The results may explain the mechanism of viral elimination during cell regeneration.