During December 1974, an epidemic of diarrhoea occurred in the Royal Children's Hospital, Melbourne, in a ward caring for neonates with acute or chronic medical and surgical problems. Electron microscopy of diarrhoeal faeces revealed a reovirus-like particle ('duovirus' or 'rotavirus') known to cause acute enteritis in older children. This virus is considered to have been primarily involved in the aetiology of the epidemic. In addition, three 'enteropathogenic' serotypes of Escherichia coli were isolated from babies during the epidemic, but none produced enterotoxin when tested in ligated ileal loops of rabbits or in monolayers of Y1 adrenal cells. Further epidemics of neonatal diarrhoea must be studied using culture and electron microscopy of faeces to determine the relative importance of this virus and of E. coli in the aetiology of diarrhoea in this age-group.