BACKGROUND: Surveillance for pneumococcal respiratory illness was conducted in children hospitalized at Affiliated Pediatric Hospital of Fudan University in Shanghai from August 2000 to August 2001. METHODS: Sputum cultures were obtained from pediatric patients admitted with pneumonia or respiratory distress by tracheal aspirate. Blood cultures were also performed on a subset of patients. All pneumococcal isolates were serotyped and tested for antibiotic susceptibility. In addition clinical information on the patients including prior antibiotic history was abstracted. Streptococcus pneumoniae tracheal isolations were attempted in a total of 1013 pediatric patients hospitalized during this period. Among these samples 112 specimens were S. pneumoniae-positive. These positive isolates underwent serotyping and antibiotic susceptibility testing. RESULTS: Five serotypes (19F, 23F, 6A, 14, 6B) of S. pneumonia accounted for 81% (91 of 112 cases). Other serotypes accounted only for 12% (13 of 112 cases), and 7% (8 of 112 cases) of isolates could not be typed by quelling test. Only one blood culture isolate was positive, probably reflecting the frequent use of antibiotic treatment before hospitalization. Fifty-one and 8.0% of isolates had intermediate and high level penicillin resistance, respectively. Fifty-eight percent were resistant to ampicillin, 6.6% to cefazolin, 25.0% to cefaclor, 6.6% to ceftriaxone, 85.7% to erythromycin, 66.7% to clindamycin and 28.2% to chloramphenicol. Among 66 isolates that were not susceptible to penicillin, serotype 19F was the most common, followed by 23F and 14. CONCLUSION: S. pneumoniae is a common cause of respiratory illness requiring hospitalization in young children in Shanghai, with antibiotic resistance increasingly common. Five serotypes account for most disease.