A long-term follow-up study was performed to identify the natural course of chronic HCV carriers with persistently normal serum ALT level (PNAL; < or =30 U/L) and to clarify the effect of interferon therapy on the inhibition of the development of hepatocellular carcinoma (HCC) in chronic hepatitis C patients with elevated ALT levels. One hundred twenty-nine HCV carriers with PNAL underwent liver biopsy, 69 were followed for more than 5 years, and 35 underwent serial liver biopsies. We included 1246 chronic hepatitis C patients (stage F1: 231, F2: 638, F3: 336, F4: 41) who received interferon therapy and were followed for more than 2 years (mean, 7.7 years). Approximately 90% of HCV carriers with PNAL had normal to mild liver histology, and 30% developed symptomatic chronic hepatitis C within 5 years. The frequency of steatosis and iron loading was significantly lower in these patients than in symptomatic chronic hepatitis C patients. The progression rate of fibrosis was slower than in chronic hepatitis C patients with elevated serum ALT levels. HCC was noted in 157 chronic hepatitis C patients after interferon therapy, and the development of HCC was significantly reduced in both sustained responders and transient biochemical responders compared with nonresponders. HCC in sustained responders mainly developed in male patients older than 55 years with advanced stage liver histology at entry. Approximately 30% of HCV-infected patients with PNAL become candidates for antiviral therapy within 5 years. Interferon therapy lowers the rate of the development of HCC in both sustained responders and transient biochemical responders.