A protoplast fusion method was developed to stably transfect human cells with pSV2-derived plasmids at frequencies greater than 10(-3). This procedure made it possible to test the biological effect of a hepatitis B virus (HBV) gene independent of the viral structures required for infection. A pSV2gpt+ plasmid constructed to carry a subgenomic fragment of HBV that contained the core antigen gene (HBc gene) was transfected into human cells. A human epithelial cell line was stably transfected with the HBc+ gene by selecting recipient cells for expression of guanine phosphoribosyl transferase expression. With this gpt+/HBc+ cell line it was shown that growth in serum-free medium or treatment with 5'-azacytidine stimulates the production of the HBV core antigen. A hepatocellular carcinoma carrying the entire HBV genome was stimulated to produce the HBc gene product in response to the same factors that stimulated HBcAg production in the gpt+/HBc+ cell line constructed by transfection. The temporal relation between the cytopathologic response and HBc gene expression was similar for both cell types, indicating a primary role for HBc gene expression in the cytopathology of HBV-infected human liver.