Hepatitis B virus (HBV) X antigen (HBxAg) may contribute to the development of hepatocellular carcinoma (HCC) by activation of signalling pathways such as NF-kappaB. To identify NF-kappaB target genes differentially expressed in HBxAg-positive compared to -negative cells, HepG2 cells consistently expressing HBxAg (HepG2X cells) were stably transfected with pZeoSV2 or pZeoSV2-IkappaBalpha. mRNA from each culture was isolated and compared by PCR select cDNA subtraction. The results showed lower levels of alpha(2)-macroglobulin (alpha(2)-M) in HepG2X-pZeoSV2 compared to HepG2X-pZeoSV2-IkappaBalpha cells. This was confirmed by Northern and Western blotting, and by measurement of extracellular alpha(2)-M levels. Elevated transforming growth factor-beta1 (TGF-beta1) levels were also seen in HepG2X compared to control cells. Serum-free conditioned medium (SFCM) from HepG2X cells suppressed DNA synthesis in a TGF-beta-sensitive cell line, Mv1Lu. The latter was reversed when the SFCM was pretreated with exogenous, activated alpha(2)-M or with anti-TGF-beta. Since elevated TGF-beta1 promotes the development of many tumour types, these observations suggest that the HBxAg-mediated alteration in TGF-beta1 and alpha(2)-M production may contribute importantly to the pathogenesis of HCC.