Hepatitis B virus (HBV) is a common viral pathogen that causes a substantial health burden worldwide. Remarkable progress has been made in our understanding of the natural stages of chronic HBV infection. A dynamic balance between viral replication and host immune response is pivotal to the pathogenesis of liver disease. Knowledge of the HBV genome organization and replication cycle can unravel HBV genotypes and molecular variants, which contribute to the heterogeneity in outcome of chronic HBV infection. Most HBV infections are spontaneously resolved in immunocompetent adults, whereas they become chronic in most neonates and infants at a great risk of developing complications such as cirrhosis and hepatocellular carcinoma (HCC). Those with chronic HBV infection may present in one of the four phases of infection: immune tolerance, immune clearance [hepatitis B e antigen (HBeAg)-positive chronic hepatitis B (CHB)], inactive carrier state, and reactivation (HBeAg-negative CHB). Understanding the dynamic nature of chronic HBV infection is crucial in the management of HBV carriers. Long-term monitoring and optimal timing of antiviral therapy for chronic HBV infection help to prevent progression of HBV-related liver disease to its later stage, particularly in patients with higher risk markers of HCC, such as serum DNA concentration, HBeAg status, serum aminotransferase, HBV genotypes, and pre-core or core mutants.