Outbreaks of hospital-acquired infections caused by methicillin-resistant Staphylococcus aureus are being recognized with increasing frequency in the United States. Two thirds of outbreaks have been centered in critical care units. Infected and colonized inpatients appear to be the major institutional reservoir, and transient carriage on the hands of hospital personnel appears to be the most important mechanism of serial patient-to-patient transmission. In over 85% of hospitals into which they have been introduced, methicillin-resistant strains of S. aureus have become established as endemic nosocomial pathogens. A program designed to control a widespread outbreak in a university hospital used three surveillance methods to identify the major institutional reservoir of colonized and infected inpatients. Daily clinical laboratory surveillance, monthly prospective microbiology surveys of high-risk inpatients, and the recognition of previously infected 38%, 31%, and 31% of new cases, respectively. After control measures were instituted, the prevalence (p less than 0.001) and the number of acquisitions (p less than 0.002) of methicillin-resistant S. aureus declined over a 12-month period.