The microbial contamination of 68 samples of topical and 324 samples of oral medicaments has been studied. The most common group of contaminants was members of the genus Bacillus (34.4%). Because of the pathogenic significance of B. cereus, 39 strains were characterized by morphology and biochemical properties. All except three showed most of the characteristics of the type strain. They were highly resistant to lincomycin, polymyxin B and penicillin G‐cephalosporin and were susceptible to streptomycin, erythromycin and chloramphenicol. Enterotoxin, phospholipase C and haemolysin production were also studied: 33 strains gave a positive vascular permeability reaction, four of them causing necrosis, and 24 showed positive mouse lethal tests. All the strains had phospholipase activity. The majority also exhibited differing degrees of haemolysis. Permeability factor was related to mouse lethality and haemolytic activity. Phospholipase C was not related to any of the above activities.