Staphylococcus aureus colonization and infection is an established pathogenic factor for disease flare in atopic dermatitis (AD). This work aims to determine the prevalence of S. aureus colonization among patients with AD and their antimicrobial susceptibility patterns to recommend the first-line antibiotic therapy. In addition, this work aims to investigate the distribution of staphylococcal toxins-encoding genes among S. aureus isolates and their correlation with AD severity. The work was carried out in collaboration between Dermatology and Venereology and Microbiology and Immunology Departments, Faculty of Medicine, Zagazig University during the period from April, 2009 to March, 2010. The study was conducted on 110 patients with AD, of whom 40 patients were presented with eczematous lesions. For isolation of S. aureus, skin and nasal swabs were taken from all patients. The staphylococcal enterotoxins-encoding genes (sea, seb and sec), toxic shock syndrome toxin-1 (TSST-1)-encoding gene (tst) and Panton Valentine leukocidin (PVL)-encoding gene (lekS-LukF-PV) were detected by specific PCR protocols. During the study period, a total of 98 (89.1%) S. aureus isolates were recovered from all patients with AD. Eighty (72.7%) strains were isolated from skin swabs, 18 (16.4%) from nasal swabs and 9 (8.2%) from both skin and nasal swabs. Among the 98 S. aureus isolates, 13 (17.3%) were MRSA and 85 (82.7%) were MSSA. The highest antimicrobial resistance was to penicillin (96.9%), followed by cephalothin (78.6%), cefotaxime (69.4%), erythromycin (49%) and trimethoprim-sulfamethoxazole (45.9%). The resistance to fusidic acid and mupirocin was 10.2% and 4.1% respectively. No resistance was detected to vanomycin. In this work, 54 (55.1%) of the 98 S. aureus isolates harbored different toxin- encoding genes, accounting for 49.1% of all AD patients. The majority of toxigenic isolates (34.7%) were positive for seb gene, followed by tst (10.2%), LukS-LukF-PV (7.1%) and sea (3.1%) genes. There was no statistical difference regarding the distribution of toxigenic isolates among AD patients in relation to the clinical severity of AD. In conclusion, the results of this study reveal the clinical importance of staphylococcal colonization as a trigger factor for AD and staphylococcal toxins as a possible factor with disease-initiating or –promoting effect. Moreover, this study clearly emphasizes that susceptibility tests of clinical S. aureus isolates to antimicrobial drugs should be regularly performed before initiating therapy. Further studies are recommended in a greater number of patients to explore the mechanisms by which other staphylococcal toxins may influence the AD manifestations and to determine the therapeutic