The impact of prolonged direct antiviral therapy on hepatitis B surface antigen (HBsAg) levels in patients with chronic hepatitis B is poorly understood. We quantitatively assessed serum HBsAg levels during 3 years of telbivudine treatment, as well as their relationship with virologic and biochemical characteristics in 162 hepatitis B e antigen–positive patients who maintained undetectable serum hepatitis B virus (HBV) DNA long‐term. Telbivudine treatment progressively reduced serum HBsAg levels (mean ± SD) from baseline (3.8 ± 0.6 log10 IU/mL) to treatment week 24 (3.4 ± 0.7 log10 IU/mL), treatment year 1 (3.3 ± 0.8 log10 IU/mL), and treatment year 3 (3.0 ± 1.4 log10 IU/mL) (P <0.0001). In this patient population, HBsAg loss was observed in nine (6%) of 162 patients through year 3. During the first year of treatment, three patterns of HBsAg decline were observed: rapid (≥1 log10 IU/mL) in 32 patients, slow (0‐1 log10 IU/mL) in 74 patients, and steady levels in 56 patients. These findings were associated with different likelihoods of HBsAg loss during long‐term telbivudine therapy. Eight of 32 patients with rapid HBsAg decline versus none of 56 patients with steady HBsAg levels achieved HBsAg loss at year 3 (P = 0.0024). HBV genotype was a significant determinant for HBsAg kinetics, with the fastest decline in genotype A patients. In patients with subsequent HBsAg loss, viral antigens were already undetectable in liver biopsy samples after 1 year of treatment. This was associated with markedly enhanced antiviral T cell reactivity. Conclusion: In patients who have effective suppression of viral replication during telbivudine treatment, a rapid decline in serum HBsAg levels during the first year may identify those with a greater likelihood of achieving HBsAg clearance. (HEPATOLOGY 2010