During interferon treatment of chronic hepatitis B, an alanine aminotransferase (ALT) flare may herald a sustained loss of viral replication, but the relationship between virologic response, the extent of a flare, and pretreatment hepatitis B virus (HBV) DNA level has not been defined. We retrospectively examined the impact of an ALT flare on sustained virologic response in 121 interferon-treated patients and 42 untreated controls with either low-level (<100 pg/mL) or high-level (> or =100 pg/mL) viremia. The degree of ALT flare was classified as mild (increase in ALT of 86-171 IU/L above baseline), moderate (increase of 172 to 343 IU/L above baseline), and severe (increase of > or =344 IU/L above baseline). Undetectable serum HBV DNA and hepatitis B e antigen (HBeAg) loss were significantly more likely at the end of follow-up in patients having a flare (P =.0001 and.001, respectively). In the high viremia group, a proportionate increase in virologic response was observed as the degree of flare increased. By multivariate analysis, high baseline HBV DNA, high pretreatment ALT, and both moderate and severe ALT flare were independently predictive of a virologic response with severe flare being the most powerful predictor for a sustained loss of serum HBV DNA (odds ratio, 5.3; P =.004). Severe flare was predictive of a virologic response in the high but not low viremia group. We conclude that a virologic response in patients with high-level viremia is dependent on the degree of ALT flare. Induction of a robust flare may enhance virologic response when high-level viremia is detected.