Dengue 2 virus was recovered from three of 123 pools of naturally infected Aedes aegypti larvae (6,200 insects) collected from water containers in Rangoon. The virus was also isolated from two of 76 pools (7,730 mosquitoes) of male Ae. aegypti, collected as larvae and reared in the laboratory to adults. Minimum field infection rates among these two groups of mosquitoes were 1:2,067 and 1:3,865, respectively. Insect pools were inoculated into Toxorhynchites splendens mosquitoes and dengue viral antigen was subsequently detected in headsquash preparations by direct fluorescent antibody technique. Identification of the dengue serotype was done by complement-fixation test. This is the first report of dengue virus isolation from naturally infected mosquito larvae. These findings suggest that transovarial transmission of dengue virus occurs in nature.