Hendra virus infection is an emerging viral disease of horses and humans in Australia. Although this disease is uncommon, cases in horses have been reported with increasing frequency since it was first recognized in 1994. Hendra virus is maintained in asymptomatic flying foxes (pteropid fruit bats). Virus shedding from these bats appears to increase at unpredictable intervals, leading to spillover events that transmit Hendra virus to horses. Infected horses usually experience a brief, severe respiratory or neurological illness with a high case fatality rate, and are thought to be incidental hosts. Horse-to-horse transmission seems to be rare among animals kept on pastures, although infected horses brought into stables have spread the virus to a few animals in close contact. In some incidents, Hendra virus spread from horses to humans during close contact; human infections from other sources, including direct contact with flying foxes, have not been reported. Four of the seven clinical cases in humans were fatal. Other species may also be susceptible to Hendra virus. Infections without clinical signs have been reported rarely in dogs exposed to infected horses, and additional species, including cats, pigs, ferrets and pocket pets (hamsters, guinea pigs), can be infected experimentally. A vaccine was recently introduced for horses, but no vaccine or specific antiviral treatment has been found yet for humans. Uncertainty about the ability of Hendra virus to persist long-term has resulted in the euthanasia of infected horses and dogs in Australia even when the illness was not fatal.