OBJECTIVE To present a case of Rhodococcus equi (RE) pneumonia and discuss its pathophysiology and treatment. METHODS An HIV-positive patient presented with pneumonia. A lung biopsy was performed after sputum and thoracentesis cultures failed to identify a pathogen. The lung biopsy revealed an unidentifiable, diphtheroid-like, gram-positive rod. A bronchoscopy performed five days after the lung biopsy produced the same diphtheroid-like, gram-positive rod. The patient was treated with several injectable antibiotics, but emergence of resistance to two of the antibiotics was suspected. Two weeks after the bacterial isolate was sent to a reference laboratory, it was identified as RE. The patient was discharged on oral antibiotics and experienced no recurrence of RE pneumonia. CONCLUSIONS RE can be difficult to identify in the microbiology laboratory, or it may be assumed to be a colonizing diphtheroid. The isolation of difficult-to-identify, gram-positive rods, or diphtheroids, from a pulmonary source in a patient with decreased cell-mediated immunity should cause one to suspect RE. RE has been noted to develop resistance to beta-lactam antibiotics during therapy. A prolonged course of combination antibiotic therapy directed at the intracellular component of infection is necessary.