The outer membrane of the hepatitis B virus consists of host lipid and the hepatitis B virus major (p25, gp28), middle (gp33, gp36), and large (p39, gp42) envelope polypeptides. These polypeptides are encoded by a large open reading frame that contains three in-phase translation start codons and a shared termination signal. The influence of the large envelope polypeptide on the secretion of hepatitis B surface antigen (HBsAg) subviral particles in transgenic mice was examined. The major polypeptide is the dominant structural component of the HBsAg particles, which are readily secreted into the blood. A relative increase in production of the large envelope polypeptide compared with that of the major envelope polypeptide led to profound reduction of the HBsAg concentration in serum as a result of accumulation of both envelope polypeptides in a relatively insoluble compartment within the cell. We conclude that inhibition of HBsAg secretion is related to a hitherto unknown property of the pre-S-containing domain of the large envelope polypeptide.