Background: To better understand the epidemiology of methicillin-resistant Staphylococcus aureus (MRSA) in Canadian hospitals, surveillance has been conducted in sentinel hospitals across the country since 1995. We report the results of the first 5 years of the program. Methods: For each newly identified inpatient with MRSA, medical records were reviewed for demographic and clinical data. Isolates were subjected to susceptibility testing and molecular typing by pulsed-field gel electrophoresis. Results: A total of 4507 patients infected or colonized with MRSA were identified between January 1995 and December 1999. The rate of MRSA increased each year from a mean of 0.95 per 100 S. aureus isolates in 1995 to 5.97 per 100 isolates in 1999 (0.46 per 1000 admissions in 1995 to 4.12 per 1000 admissions in 1999) (p < 0.05). Most of the increase in MRSA occurred in Ontario, Quebec and the western provinces. Of the 3009 cases for which the site of MRSA acquisition could be determined, 86% were acquired in a hospital, 8% were acquired in a long-term care facility and 6% were acquired in the community. A total of 1603 patients (36%) were infected with MRSA. The most common sites of infection were skin or soft tissue (25% of MRSA infections), pulmonary tissues (24%) and surgical sites (23%); 13% of the patients were bacteremic. An epidemiologic link with a previously identified MRSA patient was suspected in 53% of the cases. Molecular typing indicated that most (81%) of the isolates could be classified as related to 1 of the 4 Canadian epidemic strains of MRSA. Interpretation: There has been a significant increase in the rate of isolating MRSA in many Canadian hospitals, related to the transmission of a relatively small number of MRSA strains.