Studies of the kinetics of hepatitis C virus (HCV) decline during interferon (IFN)-based therapy have led to insights into treatment efficacy. However, the kinetics of serum alanine aminotransferase (ALT), an enzyme used as a surrogate of liver damage, have not been closely monitored, and it is not known if they correlate with those of HCV RNA. Here we describe the associations between ALT and HCV dynamics. We analyzed 35 patients treated daily with 10 mIU IFN-alpha 2b with or without ribavarin for 28 days followed by standard IFN/ribavirin therapy. Patients exhibited 4 patterns of ALT change: (1) exponential decay of ALT, (2) transient increase in ALT followed by a decrease to pretreatment or normal levels, (3) increase in ALT to a new level, and (4) no significant change. By simultaneously modeling HCV and ALT dynamics, we successfully fit the observed changes. We found ALT decays with t(1/2) = 12.7 hours. The transient increase in ALT observed in some patients suggested a mild hepatotoxic effect of IFN. However, patients with a smaller initial ALT increase achieved higher rates of viral negativity by week 72 (P =.02). The week-4 ALT decline correlated with the HCV log drop (P =.006) and the efficacy of therapy (P =.025). In conclusion, our results suggest the use of ALT as a surrogate marker for treatment effect in patients with elevated ALT.