Hepatitis B virus (HBV) RNA is downregulated by inflammatory cytokines induced in the liver by adoptively transferred HBV-specific cytotoxic T lymphocytes (CTLs) and during murine cytomegalovirus (MCMV) infections of the livers of HBV transgenic mice. The disappearance of HBV RNA is tightly associated with the cytokine-induced proteolytic cleavage of a previously defined HBV RNA-binding protein known as La autoantigen. La binds to a predicted stem-loop structure at the 5' end of the posttranscriptional regulatory element of HBV RNA between nucleotides 1243 and 1333. In the present study, we searched for nuclear RNase activities that might be involved in HBV RNA decay. Nuclear extracts derived from control livers and CTL-injected and MCMV-infected livers were analyzed for the ability to cleave HBV RNA. Endonucleolytic activity that cleaved HBV RNA at positions 1269 to 1270 and 1271 to 1272, immediately 5' of the stem-loop bound by the La protein (positions 1272 to 1293), was detected. Furthermore, we provide evidence that the cytokine-dependent downregulation of HBV RNA following MCMV infection is temporally associated with the upregulation of the endonucleolytic activity herein described. Collectively, these results suggest a model in which the steady-state HBV RNA content is controlled by the stabilizing influence of La and the destabilizing influence of nuclear RNase activities.