Hepatitis is a fatal disease of the liver caused by the Hepatitis Viruses including Hepatitis C Virus (HCV). HCV has an RNA genome and it frequently changes its genetic makeup giving rise to variants. The rate of change in the viral genome is higher in cases where the infection is uncontrolled, and the virus gets more chances to replicate. With > 6% of the general population infected with HCV, the burden of HCV infection is increasing in Pakistan mostly attributed to failure of control strategies. Response rate of anti-viral drugs used for the treatment of chronic Hepatitis C infection in different geographical regions reflect the diversity of the virus as well as the response of particular ethnic groups. Characterization of seven genetic lineages (genotypes 1-7) among the susceptible and resistant HCV types, in combination with other markers possibly will help manage HCV infected patients with respect to selection of appropriate antiviral therapy and future vaccine development against the virus. In the present study the existing pattern of HCV genotypes distribution was investigated in Peshawar, Khyber Pakhtunkhwa Province of Pakistan and characterization of HCV genotype 3a was carried out based on sequencing and phylogenetic analysis of HCV Core and non-structural protein NS5B for detection of clinically relevant mutations which may be related with response to conventional Interferon and Ribavirin combination therapy. In total 422/510 (82.75%) PCR positive samples examined by a modified type-specific PCR based assay and sequencing of the Core gene, 45.5% were identified as having HCV 3a infection. Mixed genotypic infection was detected in 22.99% of patients. Genotype 1b accounted for 11.61% while 3b was present in 5.21% of patients. Rare genotypes encountered were 2a (4.98%), 2b (3.79%) and 1a (3.32%) respectively. Patients with confirmed status of genotype 3a infection were evaluated for variables of interest at various intervals of therapy. Among 100 patients who completed therapy for 24 weeks, 43% of the patients achieved Sustained Virological Response (SVR), while 57% of the patients turned out to be Non-Responders (NRs). Mean age of the patients was low (34 ± 9.8) among patients who achieved SVR than those with non-response. The 24 weeks ALT levels were significantly low among patients with SVR as compared to NRs (p-value ≤ 0.05). The association of Early Virological Response (EVR) with SVR was found statistically significant (p-value ≤ 0.05). HCV NS5B (polymerase gene) and Core gene were sequenced in patients with SVR and NRs. Sequence comparison of amino acids in the pre and post-therapy isolates against HCV 3a reference sequence (Isolate NZL1; BAA04609), revealed that the Core region of HCV was highly conserved among all the isolates with no obvious variations between SVR and NR sequences. Full length NS5B sequence revealed four novel mutations (A67V, T131I, R374H and M425L) significantly associated with SVR (p-value ≤ 0.05) in Pakistani HCV 3a isolates. Phylogenetic analysis of the obtained viral genomic sequences based on HCV 3a Core and NS5B gene sequences with reference sequences from different countries showed that different strains of HCV genotype 3a are prevalent in Peshawar. Conclusion The present study reports that the pattern of HCV subtypes distribution in Peshawar, KP province has changed over times. Although less than previously reported; HCV 3a, still accounts for most of the HCV infections in Peshawar. There is increasing burden of HCV 1b or mixed infections of 1b with other types which may have consequences for disease management strategies. Phylogenetic analysis on the basis of HCV 3a Core and NS5B gene sequences indicated the presence of different lineages of HCV genotype 3a in Peshawar. Moreover, the study reveals that EVR and viral genetic mutations in NS5B region of HCV 3a can help predict treatment response among the chronically infected HCV 3a patients in Peshawar.