In order to determine whether maternal-infant (vertical) transmission of hepatitis B is a common route of infection leading to chronic antigenemia in Egypt, 901 asymptomatic women in labor were evaluated. Forty-three women (4.8 percent) were positive for HBsAg, but only one woman was positive for HBeAg. From one year of observation of children born to 13 of the HBsAg-positive mothers, vertical transmission of hepatitis B was estimated to have occurred in approximately 1.7% of births, with chronic antigenemia resulting from 0.6% of births. It was also possible to observe 29 children born to women negative for HBsAg. Horizontal transmission of hepatitis B occurred in 17.2 percent of these children during the first year of life. Maternal-infant transmission of hepatitis B at birth does not appear to be the predominant mechanism of hepatitis B transmission or a common cause of chronic antigenemia in Egypt. The first year after birth appears to be a more important period of hepatitis B transmission. Therefore, vaccination of all children at birth with hepatitis B vaccine could be an effective vaccine strategy despite a low incidence of vertical hepatitis B transmission.