In October 1995, epidemic "hemorrhagic fever," without jaundice or renal manifestations, was reported in rural Nicaragua following heavy flooding; 2259 residents were evaluated for nonmalarial febrile illnesses (cumulative incidence, 6.1%) and 15 (0.7%) died with pulmonary hemorrhage. A case-control study found that case-patients were more likely than controls to have ever walked in creeks (matched odds ratio [MOR], 15.0; 95% confidence interval [CI], 1.7-132.3), have household rodents (MOR, 10.4; 95% CI, 1.1-97.1), or own dogs with titers >/=400 to Leptospira species (MOR, 23.4; 95% CI, 3.6-infinity). Twenty-six of 51 case-patients had serologic or postmortem evidence of acute leptospirosis. Leptospira species were isolated from case-patients and potential animal reservoirs. This leptospirosis epidemic likely resulted from exposure to flood waters contaminated by urine from infected animals, particularly dogs. Leptospirosis should be included in the differential diagnosis for nonmalarial febrile illness, particularly during periods of flooding or when pulmonary hemorrhage occurs.