Feline infectious peritonitis (FIP) is a fatal disease caused by feline coronavirus (FCoV) infection. FCoV can be divided into serotypes I and II. The virus that causes FIP (FIPV) is believed to occur sporadically and spread infrequently from cat to cat. Recently, an FIP outbreak from an animal shelter was confirmed in Taiwan. FCoV from all the cats in this shelter were analyzed to determine the epidemiology of this outbreak. Thirteen of 46 (28.2%) cats with typical signs of FIP were identified. Among them, seven cats were confirmed by necropsy and/or histopathological examinations. Despite the fact that more than one FCoV was identified in this multi-cat environment, the eight FIP cats were invariably found to be infected with a type II FCoV. Sequence analysis revealed that the type II FIPV detected from fecal samples, body effusions and granulomatous tissue homogenates from the cats that succumbed to FIP all harbored an identical recombination site in their S gene. Two of the cats that succumbed to FIP were found to harbor an identical nonsense mutation in the 3c gene. Fecal shedding of this type II virus in the effusive form of FIP can be detected up to six days before death. Taken together, our data demonstrate that horizontal transmission of FIPV is possible and that FIP cats can pose a potential risk to other cats living in the same environment.