A Stirling Engine or Heat Pump having two relatively movable machine elements for power transmission purposes includes a hermetic seal bellows interposed between the elements for separating a working gas from a pressure compensating liquid that balances pressure across the bellows to reduce bellows stress and to assure long bellows life. The volume of pressure compensating liquid displaced due to relative movement between the machine elements is minimized by enclosing the compensating liquid within a region exposed to portions of both machine elements at one axial end of a slidable interface presented between them by a clearance seal having an effective diameter of the seal bellows. Pressure equalization across the bellows is achieved by a separate hermetically sealed compensator including a movable enclosed bellows. The interior of the compensator bellows is in communication with one side of the seal bellows, and its exterior is in communication with the remaining side of the seal bellows. A buffer gas or additional liquid region can be provided at the remaining axial end of the clearnace seal, along with valved arrangements for makeup of liquid leakage through the clearance seal.