Chronic hepatitis C virus (HCV) infection is associated with a spectrum of liver diseases and a proportion of chronic cases progress through cirrhosis to hepatocellular carcinoma (HCC). The viral and host factors that are important in the clinical and histological progression of HCV infection are unclear. We investigated the effect of moderate (<80 g/day) and heavy (>80 g/day) alcohol intake on the histological and clinical progression of HCV infection and their associated risk of hepatic cancer in a group of Japanese patients. A number of other variables were assessed to evaluate their impact on disease progression. We recruited 120 patients with HCV infection and categorized them into four groups, based on alcohol consumption pattern. All clinical and biochemical profiles were collected from recorded files. Liver biopsies were analysed for the degree of fibrosis, presence of cirrhosis and histological activity of necroinflammation. Hepatic tumours were detected by the follow-up imaging analysis. There was no difference in the age, length of exposure to HCV infection and HCV RNA serum levels in the alcohol and alcohol-free groups. The histological grading of necroinflammation, serum levels of alanine aminotransferase and HCV RNA did not have any correlation with each other in the alcohol and alcohol-free group. There was a 1.5-2. 5-fold greater risk of liver cirrhosis and hepatocellular carcinoma in the alcohol intake group compared to the alcohol-free group. Kruskal-Wallis analysis among four groups demonstrated a significant transition to fibrosis (P < 0.05) for alcoholics with HCV infection. The increased risk of liver cancer in the alcohol group is independent of size and growth of tumours. The clinical manifestations of gastro-oesophageal variceal bleeding, ascites, and encephalopathy were also higher in the alcohol intake group. Alcohol consumption is an important risk factor in the histological and clinical progression of HCV infection and has no relation with HCV replication. Chronic HCV carriers should avoid excessive alcohol intake to reduce the acceleration of liver disease and risk of liver cancer.