Hepadnavirus genome replication involves cytoplasmic and nuclear stages, requiring balanced targeting of cytoplasmic nucleocapsids to the nuclear compartment. In this study, we analyze the signals determining capsid compartmentalization in the duck hepatitis B virus (DHBV) animal model, as this system also allows us to study hepadnavirus infection of cultured primary hepatocytes. Using fusions to the green fluorescent protein as a functional assay, we have identified a nuclear localization signal (NLS) that mediates nuclear pore association of the DHBV nucleocapsid and nuclear import of DHBV core protein (DHBc)-derived polypeptides. The DHBc NLS mapped is unique. It bears homology to repetitive NLS elements previously identified near the carboxy terminus of the capsid protein of hepatitis B virus, the human prototype of the hepadnavirus family, but it maps to a more internal position. In further contrast to the hepatitis B virus core protein NLS, the DHBc NLS is not positioned near phosphorylation target sites that are generally assumed to modulate nucleocytoplasmic transport. In functional assays with a knockout mutant, the DHBc NLS was found to be essential for nuclear pore association of the nucleocapsid. The NLS was found to be also essential for virus production from the full-length DHBV genome in transfected cells and from hepatocytes infected with transcomplemented mutant virus. Finally, the DHBc additionally displayed activity indicative of a nuclear export signal, presumably counterbalancing NLS function in the productive state of the infected cell and thereby preventing nucleoplasmic accumulation of nucleocapsids.