We investigated whether regulation of interferon-alpha gene expression could be involved in liver tumor biology and the role, if any, of hepatitis B virus in the regulation of tumor cytokine gene expression. Gene expression was investigated at the transcriptional level using 'in situ' hybridization of cytokine message with an interferon-alpha cDNA probe and at the translational level with immunohistochemistry using an immunoperoxidase technique. Compared to histologically normal liver, a greater percentage of tumor and non-tumor-involved liver tissue sections (67-80% vs. 17%) contained cells positive for interferon-alpha messenger RNA, many of which were also seen to contain an increased number of transcripts (> 100 grains/cell). Hepatitis B infection did not appear to play a role in gene activation, at the hepatocellular level, in liver disease. Except for sinusoidal cells, cells containing cytokine transcripts also produced mature immunoreactive protein. Absence of interferon-alpha protein within mononuclear and sinusoidal cells in seronegative hepatocellular carcinoma tissue with/without underlying liver disease suggested deficient cytokine gene expression, at the post transcriptional level, within these cells in this group. Bile duct epithelia in tumor tissue were found to contain immunoreactive protein for interferon-alpha. In summary our results suggest that interferon-alpha gene activation in hepatocellular carcinoma occurs as a result of the liver cell damage and does not play a dominant role in tumor biology.