A survey of 751 families with a total number of more than 3,200 individuals was carried out. The sex-age standardized prevalence of serologic evidence of hepatitis B (HB) was, in families with an index-donor antigen positive, ten times as high, and in those with an index-donor antibody positive, two to three times as high as in control families of the same ethnic background. The frequency of familial aggregation (two or more cases) was also unusually high (39–48 per cent). Familial prevalence and aggregation were found to be associated with family size. The highest prevalence of antigenemia was observed among sibs and parents (11 to 34 per cent) and the lowest among spouses (0 to 5 per cent). Sibs matched to the index-carriers by age showed a four to sixfold higher antigen prevalence than unmatched sibs. An excellent fit with the recessive inheritance hypothesis was obtained in genetic segregation analyses. In two of three matings with both members antigen positive, all progeny were found to be antigen positive. This study provided evidence indicating that familial aggregation and segregation of HB are influenced by both environmental and genetic factors.