We screened phase variants of Klebsiella pneumoniae isolates for the expression of capsule and type 1 fimbriae and found that all of the 22 blood isolates were encapsulated and did not express type 1 fimbriae while 10 of 11 urinary tract isolates expressed type 1 fimbriae but were unencapsulated. Phase variants from selected isolates were found to be either unencapsulated and fimbriated or lacked both structures. Variants expressing both structures were not detected. Fimbrial subunits FimH and FimA were localized in the periplasmic space of the parent strain and on the surface of the unencapsulated variants. The results suggest that capsule formation impedes assembly of pre-formed fimbrial subunits on the bacterial surface.