Understanding the consequences of mutation in the hepatitis B virus (HBV) genome on HBV replication is critical for treating chronic HBV infection. In this study, HBV replication in HepG2 cells initiated by transduction with precore (PC), rtM204I, and wild-type (wt) HBV recombinant baculoviruses was compared. The pattern and magnitude of HBV replication initiated by the PC HBV recombinant baculovirus were similar to those observed for wt HBV throughout the time course examined. In contrast, when the rtM204I mutation was introduced into wt HBV, by day 10 postinfection the levels of intra- and extracellular HBV DNA were markedly reduced compared to those for wt HBV. Although the rtM204I mutation reduced the production of HBV replicative intermediates, no effect on the level of covalently closed circular DNA or HBV transcripts was observed at late time points. Coinfection studies with different ratios of wt and rtM204I baculoviruses showed that the rtM204I variant did not produce a product that inhibited HBV replication. However, the combination of the wt and rtM204I baculoviruses yielded HBV DNA levels at late time points that were greater than those for the wt alone, suggesting that wt polymerase may function in trans to boost rtM204I replication. We concluded that the rtM204I mutation generates a polymerase that is not only resistant to lamivudine but also replicates nucleic acids to lower levels in vitro.