Infections due to multidrug-resistant pneumococci are a growing concern. Through December 1995, over 85% of isolates recovered from our patients in Chicago, Illinois, were fully susceptible to penicillin, and only a rare resistant strain was recovered from blood or cerebrospinal fluid (CSF). In December 1995, we began to observe bloodstream infections due to Streptococcus pneumoniae with penicillin MICs that represented either intermediate or full resistance to penicillin. S. pneumoniae isolated between January 1, 1993, and December 31, 1996, were tested against 11 different antimicrobial agents. There were 158 from blood or CSF, and 303 from other (primarily respiratory) sources. During 1996, 46% of our total S. pneumoniae isolates were no longer fully susceptible to penicillin, representing a threefold increase from the previous year's experience. In isolates from blood and CSF, more than 90% of strains had been fully susceptible to penicillin through 1995, but since the start of 1996, 29% of our invasive isolates were no longer fully susceptible to penicillin. During 1996, vancomycin was the only currently approved agent that was active against all recovered isolates. We also noted two isolates during 1996 where optochin testing did not accurately identify strains as S. pneumoniae. A major problem with multidrug-resistant S. pneumoniae causing both respiratory and invasive diseases appears to have now reached the Chicago area. Laboratories need to be aware of a continued increase in antimicrobial agent resistance exhibited by this pathogen, as well as potential difficulties that can be encountered using traditional laboratory identification methods.