Nosocomial transmission of adenovirus type 3 associated with fatalities in infants has not been frequently reported. This report describes the nosocomial spread of adenovirus types 2 and 3 among infants with bronchopulmonary dysplasia in a chronic (transitional) care facility. The index case developed pneumonia with a clinical deterioration in respiratory status 8 days after admission. Within the next 10 to 30 days 9 other infants and 2 health care personnel became ill with respiratory symptoms. Three of these 10 infants had progressive respiratory failure and 2 of them died. All of these infants had underlying chronic lung disease of bronchopulmonary dysplasia. The overall attack rate was 30% (10 of 33). Further spread of adenovirus was prevented by using barrier precautions and masks while performing tracheostomy care. Adenovirus isolates were serotyped as Ad3 in 4 patients and 1 staff member, as Ad2 in 3 patients, and as a combination of Ad2 and Ad3 in 1 patient. Two fatalities were associated with Ad3 infection. Three isolates from 2 patients and 1 staff member were not available for typing. Restriction endonuclease analysis was performed on all of these isolates of Ad3 and Ad2. There was no genetic heterogeneity in the isolates, suggesting a common source.