The potential for hepatitis B virus (HBV) to alter its genome is considerable. This occurs because the virus utilizes a reverse transcription step in replicating the viral genome. Like human immunodeficiency virus, the reverse transcriptase of HBV is error prone and as a consequence of specific selection pressures within a host a population of viral quasispecies emerges. HBV mutants with survival advantages over the wild type virus appear within the selective in vivo environment. Some of these viruses include HBV vaccine escape and anti-viral resistant mutants that have changes in the envelope (S) and polymerase genes, respectively. In addition, the genome of HBV is organised in to overlapping reading frames. The S gene is completely overlapped by the polymerase gene. As a consequence, mutations in the S gene may produce changes in the overlapping polymerase gene. Similarly, mutations in the polymerase gene may produce changes in the S gene. The virological and clinical significance of such overlapping mutations is unclear. However, we have shown that certain mutations in either the S or polymerase gene produce functionally significant changes in the respective overlapping gene. Treatment of chronic hepatitis B carriers with long-term lamivudine (LMV) results in the selection of HBV mutants that are resistant to this nucleoside analogue. The polymerase mutations associated with LMV resistance produce changes in the overlapping S gene and in its envelope protein (hepatitis B small antigen, HBsAg) that results in a reduced antigenicity of the HBsAg protein. The selection of vaccine escape mutants by HBV vaccination or hepatitis B immune globulin is associated with changes in the S gene that are accompanied by mutations in the fingers sub-domain of the polymerase protein. When combined with polymerase mutations that are associated with resistance to LMV the changes within the fingers sub-domain of the viral enzyme behave as compensatory mutations that are able to restore the replication of LMV resistant HBV. The ability to change a viral protein by mutations in an overlapping but unrelated viral gene may produce HBV mutants with altered antigenicity and/or replication and a natural history that may be distinctly different to wild type HBV.