To determine whether disease outcomes and clades of Leishmania braziliensis genotypes are associated, we studied geographic clustering of clades and most severe disease outcomes for leishmaniasis during 1999-2003 in Corte de Pedra in northeastern Brazil. Highly significant differences were observed in distribution of mucosal leishmaniasis versus disseminated leishmaniasis (DL) (p<0.0001). Concordance was observed between distribution of these disease forms and clades of L. braziliensis genotypes shown to be associated with these disease forms. We also detected spread of DL over this region and an inverse correlation between frequency of recent DL diagnoses and distance to a previous DL case. These findings indicate that leishmaniasis outcomes are distributed differently within transmission foci and show that DL is rapidly spreading in northeastern Brazil.