Pacheco's parrot disease was identified as the cause of death of 3 psittacine birds at an aviary. Confirming a previous report, a herpesvirus was found to be the etiologic agent. The virus induced mortality in embryonated chicken eggs and budgerigars. The virus was characterized by electron microscopy, filtration experiments, and ether-sensitivity. Hepatic lesions in chick embryos and budgerigars were similar by light- and electron-microscope studies. Naked and enveloped nucleocapsids were seen in the nucleus and cytoplasm of infected hepatocytes, and naked virions were present in the sinusoids of the liver. Multinucleated cells in the liver contained virus in both intranuclear and intracytoplasmic inclusions; the latter inclusions were both membrane-bound and not. Vaccination of budgerigars with a commercial lyophilized Marek's disease vaccine did not prevent infection with the Pacheco's disease herpesvirus.