The National Bioterrorism Syndromic Surveillance Demonstration Program identifies new cases of illness from electronic ambulatory patient records. Its goals are to use data from health plans and practice groups to detect localized outbreaks and to facilitate rapid public health follow-up. Data are extracted nightly on patient encounters occurring during the previous 24 hours. Visits or calls with diagnostic codes corresponding to syndromes of interest are counted; repeat encounters are excluded. Daily counts of syndromes by zip code are sent to a central data repository, where they are statistically analyzed for unusual clustering by using a model-adjusted SaTScan approach. The results and raw data are displayed on a restricted website. Patient-level information stays at the originating health-care organization unless required by public health authorities. If a cluster surpasses a threshold of statistical aberration chosen by the corresponding public health department, an electronic alert can be sent to that department. The health department might then call a clinical responder, who has electronic access to records of cases contributing to clusters. The system is flexible, allowing for changes in participating organizations, syndrome definitions, and alert thresholds. It is transparent to clinicians and has been accepted by the health-care organizations that provide the data. The system's data are usable by local and national health agencies. Its software is compatible with commonly used systems and software and is mostly open-source. Ongoing activities include evaluating the system's ability to detect naturally occurring outbreaks and simulated terrorism events, automating and testing alerts and response capability, and evaluating alternative data sources.