An outbreak of 25 cases of Andes virus-associated hantavirus pulmonary syndrome (HPS) was recognized in southern Chile from July 1997 through January 1998. In addition to the HPS patients, three persons with mild hantaviral disease and one person with asymptomatic acute infection were identified. Epidemiologic studies suggested person-to-person transmission in two of three family clusters. Ecologic studies showed very high densities of several species of sigmodontine rodents in the area.