To observe the therapeutic effect of herbal compound, Baicao Rougan Capsule on human liver fibrosis and early cirrhosis associated with chronic hepatitis B.Forty-two patients with liver fibrosis and 10 cases early cirrhosis were treated with a herbal compound for six months. Two liver biopsies were performed before and after treatment, their serum samples were collected before, in the middle of and after the treatment, all samples were measured at the same time.Improvement of clinical symptoms and signs occurred in 75% to 91% of the patients, serum ALT lowered to normal level in 68%. The serum level of type IV collagen, laminin and hyaluronic acid were significantly reduced by the end of treatment (P < 0.05). Grading score was reduced from 7.79 +/- 6.15 to 5.36 +/- 3.95 after treatment (P < 0.05), while staging score was reduced from 7.39 +/- 5.55 to 5.26 +/- 4.36 (P < 0.05).Chinese herbal compound Baicao Rougan Capsule is effective in the treatment, and in the reversal of HBV related liver fibrosis and early cirrhosis.