Long‐term follow‐up of 27 patients with hepatitis B virus—related chronic liver disease treated by transplantation showed that 23 had hepatitis B virus recurrence. In 13 patients late changes in the grafts were similar to those described in other series: minor abnormalities in five cases, chronic active hepatitis in five cases and non‐hepatitis B virus—related graft dysfunction in three cases. Three patients had incomplete histological follow‐up. Analysis of the histological changes and viral antigen expression in six cases revealed a distinct and novel pattern termed fibrosing cholestatic hepatitis. Development of fibrosing cholestatic hepatitis was associated with rapidly progressive graft dysfunction. It is postulated that this pattern of fibrosing cholestatic hepatitis develops because of a high cytoplasmic expression of viral antigens, including HBsAg. The remaining case had some features of fibrosing cholestatic hepatitis. The main histological features of this unique syndrome include thin, perisinusoidal bands of fibrosis extending from portal tracts to surround plates of ductular‐type epithelium; prominent cholestasis; ground‐glass transformation; and ballooning of hepatocytes with cell loss and mild mixed inflammatory reaction. (HEPATOLOGY 1991;13:150–157).