During a 19-month period from April 1993 to October 1994, 41 isolates of vancomycin-resistant Enterococcus faecium (VREF) were detected in seven different hospitals in a city in southern Texas. A case-control study to determine the risk factors for acquisition was done in the hospital in which the majority of isolates were detected. Pulsed-field gel electrophoresis (PFGE) of whole-cell DNA was used to determine strain identity. Thirty-five (85%) of the 41 VREF isolates were of the vanB phenotype. Of these, 32 (91%) of 35 were the same strain by PFGE typing. The same vanB strain was documented in five different hospitals in the city. In contrast, 4 (67%) of 6 of the vanA phenotype VREF isolates were distinct strains by PFGE typing. Significant risk factors for colonization or infection with VREF were prior exposure to antibiotics (P = .04), the previous use of third-generation cephalosporins (P = .03), and the previous use of parenteral vancomycin (P = .002). Infection-control and antibiotic-utilization measures were implemented to control cross-transmission and selection of VREF isolates. During the emergence of VREF in our city, clonal dissemination of a single strain of vanB VREF among six hospitals was documented. Limited cross-transmission of vanA phenotype VREF isolates occurred, but most vanA VREF isolates were distinct strains selected in individual hospital environments.