We investigated an outbreak of multidrug-resistant Acinetobacter baumannii-calcoaceticus complex infection among US service members injured in Iraq. The investigation was conducted in Iraq and Kuwait, in the 2 military hospitals where the majority of injured service members were initially treated. After initially characterizing the outbreak, we evaluated 3 potential sources of infection for the period March 2003 to December 2004. The evaluation included screening samples that were obtained from the skin of patients for the presence of colonization and assessing the soil and health care environments for the presence of A. baumanii-calcoaceticus complex organisms. Isolates obtained from samples from patients in US Military treatment facilities, as well as environmental isolates, were genotypically characterized and compared using pulsed-field gel electrophoresis. A. baumanii-calcoaceticus complex organisms were present on the skin in only 1 (0.6%) of 160 patients who were screened and in 1 (2%) of 49 soil samples. A. baumanii-calcoaceticus complex isolates were recovered from treatment areas in 7 of the 7 field hospitals sampled. Using pulsed-field gel electrophoresis, we identified 5 cluster groups in which isolates from patients were related to environmental isolates. One cluster included hospitalized patients who had not been deployed to Iraq. Among the clinical isolates, only imipenem, polymyxin B, and colistin demonstrated reliable in vitro antimicrobial activity. Generally, the environmental isolates were more drug susceptible than were the clinical isolates. Our findings suggest that environmental contamination of field hospitals and infection transmission within health care facilities played a major role in this outbreak. On the basis of these findings, maintaining infection control throughout the military health care system is essential. Novel strategies may be required to prevent the transmission of pathogens in combat field hospitals.