The authors studied 1,211 laboratory-confirmed, non-outbreak-related cases of giardiasis in Vermont residents reported through Vermont's laboratory-based active surveillance system between 1983 and 1986. Giardiasis was the most common reportable disease in the state, with an average annual incidence rate of 45.9 cases per 100,000 population per year. This rate is higher than that in other states reporting giardiasis incidence. Morbidity from giardiasis was also significant in that 30% of cases reported symptoms lasting four or more weeks. Waterborne transmission was suggested to be an important cause of non-outbreak-related cases because rates of infection were highest in persons receiving nonfiltered municipal or nonmunicipal residential drinking water. Rates were also higher at higher elevations, where water supplies may be difficult to protect from contamination. In addition, the pattern of age-specific incidence rates and the high estimated incidence of infection in children attending day care suggested that person-to-person transmission also played a role in causing non-outbreak-related cases. Routine surveillance data can serve to indicate likely important routes of transmission of giardiasis in the community.