Isolates of Sarcocystis falcatula-like organisms from South American opossums were characterized based on biological and morphological criteria. Sporocysts from intestinal scrapings of 1 Didelphis marsupialis and 8 Didelphis albiventris from São Paulo, Brazil, were fed to captive budgerigars (Melopsittacus undulatus). Budgerigars fed sporocysts from all 9 isolates became ill and S. falcatula-like schizonts were identified in sections of their lungs by immunohistochemical staining. Sarcocystis falcatula-like organisms were cultured from lungs of budgerigars fed sporocysts from D. marsupialis and from lungs of budgerigars fed sporocysts from 3 of 8 D. albiventris. The 33/54 locus amplified by polymerase chain reaction from culture-derived merozoites contained both a HinfI endonuclease recognition site previously suggested to diagnose S. falcatula and a DraI site thought to diagnosed S. neurona. Development of the isolate from D. marsupialis was studied in cell culture; its schizonts divided by endopolygeny, leaving a residual body. Morphological and genetic variation differentiated this Sarcocystis isolate originating in D. marsupialis from the Cornell I isolate of S. falcatula. This is the first report of a S. falcatula infection in the South American opossum, D. marsupialis.