Studies to determine the epidemiologic behavior of strains of Staphylococcus aureus resistant to methicillin and aminoglycosides (MARS) were conducted over a period of two and one-half years, during which MARS were isolated from 201 patients at a hospital in the midwestern United States. Most cases of infection or colonization with MARS (156 of 201) occurred in patients with burns. In the burn unit, MARS were recovered from the air, from the hair and hands of personnel, and from inanimate objects. Nasal (72%) and rectal (66%) colonization were common among burned patients with infected or colonized burn wounds but occurred in only six of 74 burn unit personnel. When compared with two control periods, the prophylactic use of antistaphylococcal agents in patients with burns increased markedly at the time the outbreak began. Of the 45 patients without burns from whom MARS were isolated, 42 (93%) were surgical patients. MARS were not demonstrated in the air or environment of patients with infected surgical wounds. None of 334 non-burn unit hospital personnel were found to be carriers of MARS. Four phage types (83A, 6/75/85, 29/52/80, and 92) were recovered during the outbreak. A determinant of antibiotic resistance was probably transmitted among strains of S. aureus.