The present invention relates to methods that employ peptides or peptide derivatives to inhibit hepatitis C virus infection. The present invention is based in part on the discovery that E2 envelope glycoprotein of hepatitis C virus has previously undescribed domains that are important for interactions with cellular or viral proteins that are necessary for early steps in HCV infection. The present invention provides peptides and methods of treatment and prophylaxis of diseases induced by hepatitis C virus and related viruses.