Plasmid-encoded resistance to broad-spectrum cephalosporins and aztreonam is becoming a widespread phenomenon in clinical medicine. These antibiotics are inactivated by an array of different extended-spectrum β-lactamases (ESBLs) which have evolved by point mutations of parental TEM or SHV β-lactamases. In a previous study conducted during 1994-1995, SHV-2, SHV-2a and SHV-5 β-lactamases were found among Klebsiella pneumoniae isolates in Dubrava University Hospital. High prevalence of ESBLs among K. pneumoniae strains in this hospital (20%) required further investigation. In this investigation, β-lactamases from 42 K. pneumoniae strains collected in 1997 and 15 in 2004 from Dubrava University Hospital, were characterized in order to study the evolution of plasmid-encoded resistance to extended-spectrum cephalosporins and aztreonam in that hospital over a prolonged study period. Susceptibility to antibiotics was determined by diskdiffusion and broth microdilution method. β-lactamases were characterized by isoelectric focusing, determination of hydrolysis of β-lactam substrates, polymerase chain reaction and sequencing of blaSHV genes. All K. pneumoniae strains and their Escherichia coli transconjugants produced β-lactamase with an isoelectric point of 8.2. Based on sequencing of blaSHV genes enzymes of all transconjugants were identified as SHV-5 β-lactamase which conferred on the producing isolates high level of ceftazidime and aztreonam resistance. In this study, an outbreak of nosocomial infections caused by SHV-5 producing K. pneumoniae was described in 1997 which evolved to endemic spread of SHV-5 producing K. pneumoniae due to multiple plasmid transfer in the Dubrava University Hospital. The strains from 1997 and 2004 were not clonally related. Hospital hygiene measures should be applied in order to control the spread of epidemic strains through the hospital wards and the consumption of the broad-spectrum cephalosporins needs to be restricted to reduce the selection pressure which enables the proliferation of ESBL producers in hospital.