Polychromatic flow-cytometric assays were used to analyze paired intrahepatic and peripheral lymphocyte samples from 37 patients with chronic hepatitis C. Compared with peripheral cells, intrahepatic T cells were selectively enriched with CD45RO+ memory T cells but had a lower percentage of CD4+ T cells expressing the differentiation markers CD27 and CD28. The percentage of intrahepatic CD45RO+ and CD28+ T cells correlated with the degree of liver inflammation, which suggests that memory T cells at relatively early stages of differentiation are directly involved in liver inflammation. Despite their memory phenotype, intrahepatic T cells were defective in proliferation capability, produced less interferon- gamma in response to stimulation by T cell receptor, and contained less perforin but expressed higher levels of Fas and Fas ligand, compared with their counterparts in peripheral blood. The distinct characteristics of intrahepatic T cells suggest that they play an important role in the immunopathogenesis of chronic hepatitis C.