Mycobacterium ulcerans is an environmental bacterium which causes chronic skin ulcers. Despite significant epidemiological evidence to suggest that water is the source of infection, the organism has never been identified in the environment. Environmental water samples were collected from a small town in which an outbreak of 29 cases had occurred in a 3-year period. These were examined by mycobacterial culture and PCR amplification. Similar to previous studies, M. ulcerans was not cultured from the water samples. However, five samples were positive for M. ulcerans by PCR. These samples were collected from a swamp and a golf course irrigation system within the outbreak area. This is the first time that M. ulcerans has been demonstrated to be present in the environment and supports the postulated epidemiology of disease due to this organism.