Streptococcus agalactiae displaying resistance to penicillins, cephalosporins, and several other antibiotics have been isolated from the udders of dairy cattle receiving antibiotic exposure in the form of routine antibiotic infusions between lactations (dry cow treatment). Expression of penicillin resistance was induced by subinhibitory concentrations of penicillin, and growth in penicillin broth increased the ability of resistant strains to form colonies on penicillin agar. beta-Lactamase activity was not detected by standard assays of either resistant cells or cell lysates. However, resistant cells were able to remove penicillin activity from broth during a 4-18 hr growth period and so allow subsequent growth of sensitive strains in culture filtrates. Some resistant strains were capable of transfer of multiple beta-lactam resistance to sensitive recipients during incubation of mixed cultures on filters. Since culture filtrates and cell lysates of donors were also capable of transfer, and the transfer was inhibited by deoxyribonuclease, the transfer appears to occur by transformation.