Epidemiological studies of the highly pathogenic avian influenza virus H5N1 (HPAIV-H5N1) in pet and backyard animals are limited. Here we provide serological and virological evidences of infection in various animals in households in Bali, Indonesia in 2005 and 2006. Serum and swab samples from poultry, pigs, dogs, and cats were collected using a stratified random sampling design. Antibodies against HPAIV-H5 were detected in sera using the standard hemagglutination inhibition assay, and the presence of HPAIV-H5N1 in swabs was confirmed by using egg inoculation technique, a hemagglutination assay, and molecular methods. The phylogeny and virus dispersal were inferred using BEAST and SPREAD software. The results showed that the seroprevalence of village chickens to waterfowl, poultry to pigs, and year of study varied significantly in the province (P<0.001). The seroprevalences in dogs and cats were 1.85% and 7.50%, respectively. Moreover, HPAIV-H5N1 was isolated in all species except cats. The isolation rates varied between species and between the years of surveillance, too. Virus dispersal analysis showed that isolates from Bali grouped into two major clades with good statistical support. In light of these findings, surveillance of HPAIV should be extended to all poultry and mammalian species present in backyard environment.