To get an insight into Borna disease virus (BDV) epidemiology, an isolated flock of approximately 25 sheep within the region of Southeast Germany to which the disease is endemic was investigated over a 3-year observation period. BDV-specific antibodies and RNA in peripheral blood mononuclear cells were detected in 12.5 (year 1), 11.5 (year 2), and 19.4% (year 3) and 1.6 (year 1), 0 (year 2), and 14.9% (year 3) of the animals, respectively. BDV persisted in asymptomatic sheep for up to 2 years. Significantly higher numbers of antibody-positive animals were detected seasonally in spring and early summer, the times when usually most of the clinical cases of Borna disease occur. In spring of the third year, numbers of antibody-positive and viral-RNA-positive animals increased significantly despite their having no obvious clinical symptoms. The removal of all antibody- and RNA-positive animals from the flock did not reduce the prevalence of BDV infections in the following year. During a 3-month observation period of three antibody-positive animals, viral RNA was repeatedly detected by reverse transcription-PCR in nasal secretions, saliva, and conjunctival fluids. Sequence analysis revealed clustered nucleotide exchanges among sheep BDV p24 genomes, which differed at five positions from the clustered nucleotide exchanges seen in horse BDV p24 genomes.