The PEARLS study prospectively monitored selected nosocomial pathogens from 38 centres in 13 European, three Middle Eastern countries and South Africa during 2001-2002. Extended spectrum beta-lactamase (ESBL) production rates among Escherichia coli, Klebsiella pneumoniae, and Enterobacter spp. were 5.4% (142/2609), 18.2% (401/2,206) and 8.8% (204/2,328), respectively, for all study sites. The overall ESBL production rate for the combined Enterobacteriaceae was 10.5% (747/7,143), highest in Egypt, 38.5%, and Greece, 27.4%, and lowest in The Netherlands, 2.0%, and Germany, 2.6%. IEF, PCR and DNA sequencing determined 10.7% false positives among Enterobacter spp. when using NCCLS guidelines to screen for ESBL production. The prevalence of nosocomial methicillin-resistant Staphylococcus aureus and vancomycin-resistant Enterococcus faecium was 32.4% (294/908) and 8.7% (83/949), respectively. PEARLS provides baseline data against which prospective changes in resistant determinants and outcomes can be measured in this ongoing study.