The treatment of chronic hepatitis B has greatly improved with the introduction of potent nucleos(t)ide analogues with a high barrier to resistance and peginterferon. The advantages and limitations of both treatment options should be considered when a patient has an indication to initiate antiviral therapy. Nucleos(t)ide analogues can be prescribed to all patients in whom treatment is indicated and offer easy daily oral dosing, are well tolerated and able to maintain suppression of viral replication for prolonged periods of time. However, a sustained off-treatment response is unlikely. A sustained response is more likely to be achieved in a subgroup of patients with a finite course of peginterferon therapy. Furthermore, sustained responders to peginterferon experience a strong degree of serum hepatitis B surface antigen (HBsAg) decline resulting in a higher rate of HBsAg clearance. Both peginterferon and nucleos(t)ide analogues can be given as first-line treatment option for chronic hepatitis B. However, peginterferon should only be considered for patients with a high chance of response because of the considerable side effects associated with this agent. Predictors of response at baseline, such as hepatitis B virus (HBV) genotype, alanine aminotransferase and HBV DNA levels, aid in selecting patients for peginterferon therapy, especially in hepatitis B e antigen (HBeAg-)positive disease. Furthermore, on-treatment viral markers, in particular quantitative HBV DNA and HBsAg, allow the identification of patients who are unlikely to benefit from peginterferon early during the treatment course, thereby avoiding unnecessary treatment. Patients who are not eligible for peginterferon or who have a low probability of response to peginterferon based on baseline or on-treatment factors should be advised to initiate or switch to nucleos(t)ide analogue therapy.