This report presents the results of applying the reverse transcriptase-polymerase chain reaction (RT-PCR) to the analysis of clinical specimens during the 1998 dengue epidemic in Nicaragua. The RT-PCR was validated through comparison with viral isolation, resulting in a sensitivity of 100% and a specificity of 90%. In-country application of the RT-PCR permitted the rapid identification of dengue-3 virus as the cause of the epidemic at the beginning of 1998 and the detection of the reintroduction of dengue-2 virus in the middle of the year. Nineteen isolates of dengue-3 and one of dengue-2 were characterized using the restriction site-specific (RSS)-PCR technique. This showed that the dengue-3 strain belonged to the "Sri Lanka" subtype and that the dengue-2 strain belonged to the "Jamaica" subtype, both of which have been associated with hemorrhagic dengue in the Americas. The application of these simple PCR-based strain typing methods in a country endemic for dengue virus infections can help to characterize the transmission dynamics of this important emerging infectious disease problem and provide this information to local health authorities in a timely manner so that appropriate control measures can be implemented.