Summary.  Immune‐mediated mechanisms have been implicated in liver pathogenesis and subsequent progression in hepatitis B virus (HBV) infection. Costimulatory molecules, the important regulators of immune responses, participate in the regulation of liver pathology in HBV infection. However, the role of B7‐H3 (CD276, a new member of B7 family) in this process has not been investigated. In this study, we detected abundant soluble B7‐H3 (sB7‐H3) in the plasma of patients with chronic HBV infections. The increase of the plasma B7‐H3 was associated with the progression of liver cirrhosis and accompanied by decreased expression of B7‐H3 on hepatocytes. The identification analysis suggests that the plasma B7‐H3 might be derived from the membrane‐bound B7‐H3 on hepatocytes. A functional study showed that immobilized (4Ig) B7‐H3Ig fusion protein could inhibit TCR‐induced proliferation and IFN‐γ secretion of T cells, which could be partially blocked by soluble B7‐H3flag fusion protein. These results suggest that the reduced expression of B7‐H3 in the livers might temper the inhibition of T‐cell responses mediated by B7‐H3 expressed on hepatocytes and thus promote the hepatic inflammation and hepatitis progression in the chronic HBV‐infected patients.