Inclusion Criteria:

1. Patient is between 18 and 60, inclusive.
2. Patient is HBV DNA positive with DNA levels at screening >= 3 x 1,000,000 copies/mL.
3. Patient is documented to be HBsAg positive for > 6 months and HBeAg positive.
4. Patient has AST and ALT levels which are >= 1 times and <= 10 times the upper limit of normal (x ULN).
5. Patient has bilirubin levels <= 1.5 x ULN or bilirubin levels > 1.5 x ULN with diagnosis of Gilbert's disease and conjugated bilirubin within normal limits.
6. Women of childbearing age must have a negative urine (b-HCG) pregnancy test before start of trial treatment.
7. Patient is able to give written informed consent prior to study start and to comply with the study requirements.

Exclusion Criteria:

1. Patient is currently receiving antiviral, immunomodulatory or corticosteroid therapy.
2. Patients previously treated with lamivudine, lobucavir, adefovir, famciclovir, or any other investigational nucleoside for HBV infection.
3. Previous treatment with interferon must have ended at least 6 months prior to the screening visit.
4. Patient has a history of ascites, variceal hemorrhage or hepatic encephalopathy.
5. Patient is co-infected with HCV or HIV.
6. Patient has evidence of decompensated cirrhosis or hepatocellular carcinoma (alpha fetoprotein).
7. Patient is pregnant or breast-feeding.
8. Patient is unwilling to use an "effective" method of contraception during the study and for up to 3 months after the use of study drug ceases. For males, condoms should be used. Females must be surgically sterile (via hysterectomy or bilateral tubal ligation), post-menopausal, or using at least a medically acceptable barrier method of contraception (i.e., IUD, barrier methods with spermicide or abstinence).
9. Patient has a clinically relevant history of abuse of alcohol or drugs.
10. Patient has a significant gastrointestinal, renal, hepatic (decompensated), bronchopulmonary, neurological, cardiovascular, oncologic or allergic disease.
11. Subjects who are currently participating in another investigational study or has been taking any investigational drug within the last 4 weeks prior to Screening Visit.
12. Subjects who are taking any traditional Chinese medication, or has been taking any traditional Chinese medication within the last 2 weeks prior to Screening Visit.
13. Any criteria, which, in the opinion of the investigator, suggests that the subject would not be compliant with the study protocol.