Prevalence of hepatitis C virus (HCV) infection in Nepal was studied by assaying sera from different population groups for anti-HCV by the second generation enzyme immunoassay method and for HCV RNA by polymerase chain reaction. The anti-HCV was positive in 0.6% of 2,860 healthy adults. HCV infection was responsible for 1.3% of acute viral hepatitis. Only drug addicts (DA) are known to have a very high incidence of the infection. The number of intravenous drug abusers (IDA) in Nepal have increased considerably since 1991 when buprenorphine (tidigesic) was introduced in the local market. About 72% of the drug addicts were found to be IDA and 94% of the IDA were anti-HCV positive. It is concluded that though the prevalence of HCV infection in the community is low, and at present it accounts for only a small number of acute and chronic liver diseases, the presence of a large number of DA in the country with high incidence of HCV infection may result in the emergence of HCV as an important cause of chronic liver disease in Nepal in future.