Interferon is becoming the standard treatment in adults for chronic hepatitis C. Twenty one children with histologically proved chronic hepatitis C (10 boys, range 2.5-13 years), who were otherwise healthy, were enrolled in a randomised controlled study to test their response to interferon alfa. Eleven children were treated with lymphoblastoid interferon alfa (3 million units/m2) for 12 months; 10 children received no treatment. All had raised transaminases and positive antihepatitis C virus (HCV) antibodies and HCV-RNA. Alanine aminotransferase (ALT) serum levels became normal in five (45%) treated patients after a mean of three weeks (range 1-6 weeks) and no relapse had occurred by the end of follow up (30th month). Only one (10%) untreated patient had normal ALT serum levels from the 11th until the 30th month. Disappearance of serum HCV-RNA, persisting throughout the follow up period, was observed in the six children (five treated) whose ALT became normal. Biopsy specimens in treated patients showed a significant improvement in Knodell's score (median (SD) basal 9.0 (2.2); final 2.0 (0.4)). Interferon treatment was well tolerated in all. This study confirms the efficacy of interferon in children with chronic hepatitis C, not only by restoring normal ALT serum levels, but also viral clearance and histological amelioration of liver inflammation. Contrary to reports in adults no biochemical and virological relapses occurred in responder children.