The burden of chronic hepatitis B infection is high in China, where prevalence exceeds 7 %. This was a randomized, double-blinded, phase III study of the efficacy and safety of telbivudine and lamivudine treatment at 104 weeks in Chinese patients with chronic hepatitis B. Hepatitis B e antigen-positive (n = 290) and -negative (n = 42) adults with nucleoside analog-na < ve compensated chronic hepatitis B were randomized to receive telbivudine 600 mg/day or lamivudine 100 mg/day for 104 weeks. The primary endpoint was reduction from baseline in serum hepatitis B virus (HBV) DNA at week 52. Week 104 analyses included HBV DNA reductions, undetectable HBV DNA (< 300 copies/mL), ALT normalization, and e-antigen loss/seroconversion. Efficacy at week 104 was also assessed as a function of week 24 HBV DNA. In the intention-to-treat population (n = 332) at week 104, telbivudine was superior to lamivudine for reduction of HBV DNA [-5.48 vs. -4.00 log(10) copies/mL; difference -1.49 log(10) (95 % confidence interval -2.2, -0.8); p < 0.0001], for the proportion with undetectable HBV DNA (61.9 vs. 38.5 %; p < 0.0001), for ALT normalization (75.8 vs. 61.3 %; p = 0.0049), and for e-antigen loss (39.9 vs. 28.2 %; p = 0.0373). The cumulative probability of genotypic drug resistance was 15.4 % on telbivudine versus 23.6 % on lamivudine through week 104. Early virologic response at week 24 was associated with improved outcomes at week 104. Adverse events were similar to those seen in the GLOBE study. Telbivudine is superior to lamivudine over 2 years of chronic hepatitis B treatment in Chinese patients.