The significance of nonspecific bronchial hyperreactivity (BHR) is a controversial issue in asthma. The natural history of BHR has not been investigated adequately although its importance as a cross-sectional risk factor for asthma is widely accepted. This paper investigates the risk factors for wheeze among people with BHR. Subjects were young adults who had participated in the second phase of the European Community Respiratory Health Survey in Melbourne, Australia. We compared the participants with wheeze and BHR (n=186) to those with asymptomatic BHR (n=66). Information was collected on sociodemographic factors, family history of asthma, and relevant environmental factors using an interviewer-administered questionnaire. Atopy to a range of aeroallergens was examined by skin prick tests. Risk factors were examined by adjusting the odds ratios (OR) by a logistic regression to control for confounding effects. Parental asthma (OR=4.2), keeping pets during childhood (OR=3.3), allergy to house dust mite (OR=2.7), allergic rhinitis (OR=2.6), and having ever smoked (OR=2.4) were associated with an increased risk of wheeze, independent of the other factors examined. When allergic rhinitis was not included as an explanatory variable, being atopic to any of the allergens assessed was found to increase the risk of current wheeze (OR=4.8). Allergic rhinitis may represent an intermediate stage in the natural history of BHR. Avoidance of pets during childhood, not smoking, and taking steps to minimize dust exposure are likely to prevent the progression from asymptomatic BHR to asthma.