Since the emergence of methicillin-resistant Staphylococcus aureus, the glycopeptide vancomycin has been the only uniformly effective treatment for staphylococcal infections. In 1997, two infections due to S. aureus with reduced susceptibility to vancomycin were identified in the United States. We investigated the two patients with infections due to S. aureus with intermediate resistance to glycopeptides, as defined by a minimal inhibitory concentration of vancomycin of 8 to 16 microg per milliliter. To assess the carriage and transmission of these strains of S. aureus, we cultured samples from the patients and their contacts and evaluated the isolates. The first patient was a 59-year-old man in Michigan with diabetes mellitus and chronic renal failure. Peritonitis due to S. aureus with intermediate resistance to glycopeptides developed after 18 weeks of vancomycin treatment for recurrent methicillin-resistant S. aureus peritonitis associated with dialysis. The removal of the peritoneal catheter plus treatment with rifampin and trimethoprim-sulfamethoxazole eradicated the infection. The second patient was a 66-year-old man with diabetes in New Jersey. A bloodstream infection due to S. aureus with intermediate resistance to glycopeptides developed after 18 weeks of vancomycin treatment for recurrent methicillin-resistant S. aureus bacteremia. This infection was eradicated with vancomycin, gentamicin, and rifampin. Both patients died. The glycopeptide-intermediate S. aureus isolates differed by two bands on pulsed-field gel electrophoresis. On electron microscopy, the isolates from the infected patients had thicker extracellular matrixes than control methicillin-resistant S. aureus isolates. No carriage was documented among 177 contacts of the two patients. The emergence of S. aureus with intermediate resistance to glycopeptides emphasizes the importance of the prudent use of antibiotics, the laboratory capacity to identify resistant strains, and the use of infection-control precautions to prevent transmission.