OBJECTIVE To study the association between Staphylococcus aureus nasal colonization and atopic dermatitis (AD) in infancy. DESIGN Population-based prospective cohort study of pregnant women and their children. SETTING This project was embedded in the Generation R Study. PARTICIPANTS A total of 1079 postnatal Dutch infants/children participated in the focus cohort. Main Exposures Nasal swabs for S aureus cultivation were taken at ages 1.5, 6, and 14 months. Main Outcome Measure Questionnaires that pertain to AD and confounders (birth weight, gestational age, sex, and parental eczema) were completed prenatally and postnatally. The outcome was AD in the first and second years of life. RESULTS A first positive culture for S aureus at age 6 months was associated with AD prevalence in the first and second years of life (adjusted odds ratio [aOR], 2.13; 95% confidence interval [CI], 1.17-3.87; and aOR, 2.88; 95% CI, 1.60-5.19, respectively) and also with severity (aOR, 3.27; 95% CI, 1.30-8.03). Moreover, frequent colonization in the first year of life (>/=2 times) held a 4.29-fold (95% CI, 1.03- to 17.88-fold) risk of moderate to severe AD in the second year of life. CONCLUSION Colonization with S aureus at age 6 months and frequent colonization in the first year of life are associated with AD and its severity in young children.