We showed that most Staphylococcus aureus strains that have borderline or intermediate susceptibility to the penicillinase-resistant penicillins (PRPs) react this way because of the activity of their jI-lactamase on these antimicrobial agents. These strains produced large amounts of staphylococcal ,I-lactamase that rapidly hydrolyzed penicillin and partially hydrolyzed the PRPs. Susceptibility to hydrolysis was penicillin > oxacillin > cephalothin > methicillin. The borderline results and the hydrolysis could be prevented by the j-lactamase inhibitors clavulanic acid and sulbactam. For intrinsically methicillin-resistant (heteroresistant) S. aureus, the inhibitors reduced the penicillin MICs, but the strains remained resistant to all the I-lactam antimicrobial agents, including penicillin. We conclude that the borderline in vitro susceptibility or resistance to PRPs in most of these S. aureus strains is mediated by j-lactamase and they are not heteroresistant or intrinsically resistant. We do not know whether this in vitro resistance is expressed clinically. We have received several problem isolates of Staphylococcus aureus from different areas of the United States that yielded borderline-susceptible (24-h incubation) or intermediate (48-h incubation) results for oxacillin and methicillin by the usual testing methods (25, 26). The MICs for these strains were 4 ,ug/ml (methicillin), 2 ,ug/ml (oxacillin), and 2 ,ug/ml (cephalothin) after 24 h of incubation at 35°C when tested by the broth microdilution method with cationsupplemented Mueller-Hinton broth (CSMHB) and 2% NaCl (36). After incubation for 48 h, the MICs generally increased 1 dilution. With disk diffusion tests using a 1-,ug oxacillin disk, zone sizes ranged from 6 to 13 mm. These isolates of borderline-susceptible S. aureus produced large amounts of staphylococcal P-lactamase as shown by their high penicillin MICs and immediate strong positive results when tested with nitrocefin. In previous studies, we showed that staphylococcal ,-lactamase affects the zone sizes attained with the disk diffusion method, in that S. aureus strains that were P-lactamase positive yielded smaller zones of inhibition than strains that were P-lactamase negative but had the same MIC (24). These observations raised the question of whether these borderline-susceptible S. aureus isolates were truly heteroresistant (often called intrinsically resistant) or whether the apparent in vitro resistance in the MIC test was caused by P-lactamase. Previous reports have shown that staphylococcal ,B-lactamase, when present in sufficient quantities for a sufficient duration, slowly hydrolyzes the penicillinase-resistant penicillins (PRPs) and cephalosporins (1, 4, 8, 9, 17-22, 28, 34). In view of this finding, we initiated studies to estimate the amount of P-lactamase produced by each S. aureus isolate by using penicillin MICs and nitrocefin test results. We also studied the effect of two P-lactamase inhibitors (clavulanic acid and sulbactam) on the MICs of penicillin, oxacillin, cephalothin, ...