In order to gain precise data on the actual epidemiology of tuberculosis (TB) in Belgrade, central Serbia, we conducted the molecular epidemiological investigation described herein. IS6110 restriction fragment length polymorphism (RFLP) typing of 176 Mycobacterium tuberculosis isolates was performed. These strains were obtained from 48.4% of all patients diagnosed with culture-proven pulmonary TB from April through September 1998 and from May through October 1999. Clusters containing strains with identical RFLP IS6110 patterns were assumed to have arisen from recent transmission. Of the 176 cases, 55 (31.2%) were grouped into 23 clusters ranging in size from two to six patients. Nearly 80% of clustered patients were directly interviewed, and transmission between family-unrelated contacts was found to be predominant in the study population. Classical contact investigation identified only 2 (3.6%) of the 55 clustered patients. The clustering of TB patients was not associated with any demographic or clinical characteristic other than infection with multidrug-resistant (MDR) M. tuberculosis strains. Nearly 70% of MDR strains were clustered, which indicates active transmission of MDR TB in Belgrade. However, this was not observed by conventional epidemiologic surveillance. In conclusion, the first molecular epidemiologic analysis of TB in the region revealed frequent recent transmission of TB and pointed out significant shortcomings of the current concept for conventional contact tracing. The results presented also demonstrate that transmission of MDR TB in Belgrade is not optimally controlled, and they provide support for the development of improved control strategies, including application of molecular methods.