Legionella-like bacteria were isolated from the respiratory tract of two patients in California, USA, and South Australia, but were not thought to cause disease. These bacteria, strains F2632 and IMVS-3376(T), were found to have identical Legionella macrophage infectivity potentiator (mip) gene sequences and were therefore further characterized to determine their genetic and phenotypic relatedness and properties. Both of these Gram-negative-staining bacterial strains grew on buffered charcoal yeast extract medium, were cysteine auxotrophs and made a characteristic diffusible bright yellow fluorescent pigment, with one strain making a late appearing colony-bound blue-white fluorescent pigment. The optimal in vitro growth temperature was 35 °C, with very poor growth at 37 °C in broth or on solid media. There was no growth in human A549 cells at either 35 or 37 °C, but excellent growth in Acanthamoeba castellani at 30 °C and poorer growth at 35 °C. Phylogenetic analysis of these bacteria was performed by sequence analysis of 16S rRNA, mip, ribonuclease P, ribosomal polymerase B and zinc metalloprotease genes. These studies confirmed that the new strains represented a single novel species of the genus Legionella for which the name Legionella steelei sp. nov. is proposed. The type strain is IMVS-3376(T) ( = IMVS 3113(T) = ATCC BAA-2169(T)).