Evaluating young children recently exposed to airborne Mycobacterium tuberculosis is a public health priority. If infected, children aged <2 years are at high risk for severe tuberculosis (TB) disease (e.g., TB meningitis). In December 2003, infectious pulmonary TB disease was diagnosed in a foreign-born nurse working in the newborn nursery and maternity ward of a New York City hospital (hospital A); the nurse had declined treatment for latent TB infection (LTBI) after testing positive 11 years earlier. An investigation including medical evaluation of contacts in the nursery and maternity ward was conducted by the Bureau of TB Control (BTBC) at the New York City Department of Health and Mental Hygiene, hospital A, and CDC. This report summarizes the results of that investigation, which determined that approximately 1,500 patients had been exposed to the nurse but the majority could not be located for evaluation. Among those who were tested, four infants had positive tuberculin skin test (TST) results, likely attributable to recent transmission of M. tuberculosis. The findings emphasize the difficulty of conducting contact investigations in certain settings and the importance of effective LTBI testing and treatment programs for health-care workers (HCWs) to prevent TB disease and subsequent health-care--associated transmission.