Extended spectrum beta-lactamase (ESBL)-producing organisms pose unique challenges to clinical microbiologists, clinicians, infection control professionals and antibacterial-discovery scientists. ESBLs are enzymes capable of hydrolysing penicillins, broad-spectrum cephalosporins and monobactams, and are generally derived from TEM and SHV-type enzymes. ESBLs are often located on plasmids that are transferable from strain to strain and between bacterial species. Although the prevalence of ESBLs is not known, it is clearly increasing, and in many parts of the world 10-40% of strains of Escherichia coli and Klebsiella pneumoniae express ESBLs. ESBL-producing Enterobacteriaceae have been responsible for numerous outbreaks of infection throughout the world and pose challenging infection control issues. Clinical outcomes data indicate that ESBLs are clinically significant and, when detected, indicate the need for the use of appropriate antibacterial agents. Unfortunately, the laboratory detection of ESBLs can be complex and, at times, misleading. Antibacterial choice is often complicated by multi-resistance. Many ESBL-producing organisms also express AmpC beta-lactamases and may be co-transferred with plasmids mediating aminoglycoside resistance. In addition, there is an increasing association between ESBL production and fluoroquinolone resistance. Although in in vitro tests ESBLs are inhibited by beta-lactamase inhibitors such as clavulanic acid, the activity of beta-lactam/beta-lactamase inhibitor combination agents is influenced by the bacterial inoculum, dose administration regimen and specific type of ESBL present. Currently, carbapenems are regarded as the drugs of choice for treatment of infections caused by ESBL-producing organisms. Unfortunately, use of carbapenems has been associated with the emergence of carbapenem-resistant bacterial species such as Stenotrophomonas sp. or Pseudomonas sp.