We describe a focal epidemic of Lyme disease, which spread from a nature preserve and affected an adjacent community of permanent residents in coastal Massachusetts. The attack rate from 1980 through 1987 was 35 percent among 190 residents living within 5 km of the nature preserve and was greatest (66 percent) among those living closest to the preserve. The risk of infection bore little relation to sex or age. Late Lyme disease, which clustered near the preserve, occurred mainly in residents infected early in the epidemic who did not have a history of erythema migrans and did not receive antibiotic therapy. All the residents with serologic evidence of infection had early or late clinical manifestations of Lyme disease, or both, during the period of study. The seasonal risk of infection was bimodal--greatest in June, with a secondary peak in October--and corresponded to periods of increased transmission. In the nature preserve, the density of the vector tick, Ixodes dammini, exceeded that in other New England sites. The zoonosis rapidly became endemic, and the severity of its impact correlated with the abundance of deer. This epidemic of Lyme disease demonstrated that outbreaks can be focal and can spread rapidly within a community of permanent residents.