The purpose of this investigation was to prospectively characterize acute hepatitis C virus (HCV) infections and to evaluate the hypothesis that the outcome is affected by identifiable clinical or viral factors. One hundred forty–two people with a history of illicit drug use who were HCV antibody-negative in 1988 were followed semiannually through 1996. HCV seroconversion (second generation enzyme immunoassay and recombinant immunoblot assay) was recognized in 43 (30%) of the participants, who were followed up for a median of 72 months. HCV RNA was detected and quantified by polymerase chain reaction in a median of 10 specimens per participant and showed two distinct patterns of viremia: viral clearance was noted in 6 (14%) of the participants, and viral persistence was observed in 37 (86%) of the participants. Subjects with viral clearance were more likely to be white (P = .004), have jaundice (P = .03), and have lower peak viral titer (P = .003). However, the outcome for a given person could not be predicted by clinical features, RNA level, or HCV subtype (as ascertained by analysis of core–E1 complementary DNA sequence). No acute infections were recognized by health care providers. At the time of seroconversion, HCV RNA was detectable in 81% of participants, and recombinant immunoblot assay (RIBA) was positive in 85% of participants. We conclude that approximately 85% of people with acute hepatitis C develop persistent viremia. However, acute infections are uncommonly recognized clinically, underscoring the importance of screening individuals at risk. Long–term follow–up, but no single laboratory test, is necessary to ascertain the outcome and in some cases make the diagnosis of acute HCV infection.