We studied 140 consecutive patients beginning continuous ambulatory peritoneal dialysis (CAPD) at one of seven hospitals to assess the relation of the nasal carriage of Staphylococcus aureus to subsequent catheter-exit-site infection or peritonitis. Shortly before the implantation of the catheters, the patients' anterior nares were cultured for the presence of S. aureus. Antibiotics were not prescribed for the S. aureus carriers, but all the patients were monitored for signs of catheter infection (median follow-up, 10.4 months). At the initiation of CAPD, 63 patients (45 percent) carried S. aureus in the nares. Nasal carriage was more frequent among the 30 patients with diabetes (77 percent) than among the 110 without the disease (36 percent). The carriers of S. aureus had a significantly higher rate of exit-site infection than the noncarriers (0.40 vs. 0.10 episode per year; P = 0.012). Of these episodes, 24 of 34 were caused by S. aureus. The rates of peritonitis of all bacterial types did not differ significantly between the groups, but all 11 episodes of peritonitis caused by S. aureus occurred among the carriers. In 85 percent of the patients with clinical S. aureus infections, the strain from the nares and the strain causing the infection were similar in phage type and antibiotic profile. We conclude that in patients beginning ambulatory peritoneal dialysis, the nasal carriage of S. aureus is associated with an increased risk of catheter-exit-site infection and that the performance of nasal cultures before the implantation of the catheter can identify patients at high risk of subsequent morbidity.