Neonatal rotaviral infection generally causes an asymptomatic or mild illness. Once introduced into a nursery, it is very difficult to eradicate. We prospectively studied an outbreak of rotavirus infection in a normal newborn nursery from October 1994 through May 1995. Stool samples from infants more than 24 hours old were tested for rotaviral infection, either weekly, biweekly, or monthly. Rotavirus was identified in 164 (16%) of 1,037 tested neonates. Ninety-four (57%) rotavirus-positive neonates became symptomatic: 56 had diarrhea, 26 developed fever (rectal temperature > 38 degrees C), 25 experienced vomiting, 17 showed poor feeding, and 14 had an elevated core temperature. In total, 24 neonates were evaluated for suspected sepsis. RNA electropherotyping of samples from 91 neonates revealed infection by the same rotavirus strain in all cases. This strain differed from that isolated from 64 rotavirus-infected infants and toddlers in the pediatric ward during the same period. Infection control procedures (hand washing, isolation of infected neonates, and careful management of diapers) and early discharge of uninfected neonates were instituted, and the outbreak was eradicated 8 months after the onset. Our findings indicate that many rotavirus-infected term neonates become symptomatic and have signs suggestive of sepsis. Extended hospital stay may be an important factor in promoting rotaviral transmission. Thus, early discharge may be an additional effective method of controlling rotavirus outbreaks in a nursery.