An outbreak of Acinetobacter spp infection in the neonatal unit at Lok Nayak Hospital, New Delhi, India, is described. During a 6-month period, 68 strains of Acinetobacter baumannii were isolated from the blood and CSF of 47 neonates admitted to the intensive care unit. Diagnosis of clinically significant bacteremia was made in 36 patients. On environmental/personnel sampling, Acinetobacter spp isolates with similar antibiogram were recovered from intravenous catheter and washbasin. Control of the outbreak was possible only after strict infection control practices in the unit. It was concluded that any clinical multidrug resistant A. baumannii isolate can be a potential nosocomial outbreak strain.