Interferon (IFN) has been used in the treatment of chronic hepatitis B for decades. Beneficial effects including hepatitis B e antigen/HBV DNA seroclearance have been documented. However, the effect of treatment on the prevention of cirrhosis and hepatocellular carcinoma (HCC) development remains controversial. We conducted a meta-analysis of available literature to evaluate whether IFN reduces the incidence of liver cirrhosis and HCC in patients with chronic hepatitis B. Twelve clinical controlled trials, including 2082 patients and comparing IFN with no treatment, were selected. Data on the incidence of liver cirrhosis and HCC in IFN treated and untreated patients were extracted from each study. The evaluation of preventive effectiveness was performed with an intention-to-treat method. The relative risk (RR) and 95% confidence interval (CI) of the main outcomes as a measure of efficacy were used. Meta-analysis was performed using fixed-effect or random-effect methods, depending on absence or presence of significant heterogeneity. Analyses were performed with STATA version 9.0 and Review Manager Version 4.2. Five studies including the data on development of liver cirrhosis, and eleven studies including the data on development of HCC were analyzed. There was no evidence for publication bias on the funnel plot or by Egger's test, and the heterogeneity test indicated that the variation of trial-specific RR was not statistically significant. A different incidence of liver cirrhosis and HCC was observed between treated and untreated patients. The RR of liver cirrhosis and HCC was 0.65 (95% CI: 0.47, 0.91) and 0.59 (95% CI: 0.43, 0.81), respectively. In conclusion, the results of this meta-analysis indicate that IFN prevents or delays the development of liver cirrhosis and HCC in patients with chronic hepatitis B.