Genetic analysis of all eight genes of two Nanchang avian influenza viruses, A/Duck/Nanchang/1681/92 (H3N8-1681) and A/Duck/Nanchang/1904/92 (H7N1-1904), isolated from Jiangxi province, China, in 1992, showed that six internal genes of H3N8-1681 virus and five internal (except NS gene) genes of H7N1-1904 virus were closely similar to A/Goose/Guangdong/1/96 (H5N1) virus, the first highly pathogenic avian influenza (HPAI) virus of subtype H5N1 isolated in Asia. The neuraminidase (NA) gene of Gs/Gd/1/96 had the highest genetic similarity with A/Duck/Hokkaido/55/96 (H1N1-55) virus. The haemagglutinin (HA) gene of Gs/Gd/1/96 virus might have originated as a result of mutation of H5 HA gene from A/Swan/Hokkaido/51/96 (H5N3-51)-like viruses. The PA gene of H5N3-51 virus had the highest similarity with Gs/Gd/1/96. This study explains the origin of first Asian HPAI H5N1 virus in Guangdong by the reassortment of Nanchang (close to Guangdong) and Hokkaido (Japan) (H1N1-55 and H5N3-51) viruses. Genetic characteristics of donor and recipient viruses were also studied.