Potentially lethal bacteria immune to a common antibiotic have infected 21 newborn babies at Auckland City Hospital's neonatal intensive care unit.
A similar outbreak at Wellington Hospital's NICU in 2004 left three babies dead and more than 30 infected.
The Wellington bacterial strain was slightly different from that in Auckland's NICU.
Staphylococcus aureus, a bacterium commonly found on human skin, was first reported at the 41-bed unit in April. It was full at the time.
Staph. aureus is one of the top-three fatal infections for premature babies.
Such an infection often causes no more than pimples or mild rashes, but it can lead to fatal conditions including pneumonia, meningitis, toxic shock syndrome and septicemia.
Auckland City Hospital infection control clinical adviser Dr Sally Roberts said the infection was relatively common in neonatal intensive care units. It had been identified early, and appropriate infection control measures had been "stringently implemented".
While some babies had become seriously ill, it was unclear last night how much the staph. aureus infection had contributed to that. All are being screened for the infection.
Dr Roberts said all babies in the unit had been tested and grouped into red, amber and green rooms.
Red-room babies had tested positive for staph. aureus and were being cared for using strict contact precautions. Amber-room babies had shared a room with a known positive baby, and were being cared for in the same manner as the red-room babies.
Green-room babies had had no contact with infected babies.
Dr Roberts said the bacterium could be killed by flucloxacillin antibiotic. She was confident the infection had been well managed and would not lead to serious harm for the babies.
"We have been working with parents, visitors and staff to ensure that strict hygiene procedures have been put in place."
Paediatrician Diana Lennon said the bacterium was "an invasive, serious bug. Staph. aureus is an important disease for anyone who is small, or sick".
The babies in the NICU were particularly vulnerable to any infections.
Professor Lennon said the Auckland strain's immunity to a common antibiotic was also concerning, serving as a "marker" in the battle to keep antibiotics relevant.
"There is absolutely no doubt that we are gradually running out of antibiotics. So every single time we move in to something else like this, it's a marker."
* NICU is for the hospital's most ill babies and premature babies.
* Staph. aureus is a common infection but can be lethal.
* Infection can be serious or fatal for those with suppressed immunity - the elderly, the sick, and new-born babies.