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Coyotes (Canis latrans) from southern Texas were sampled for antibodies to Borrelia burgdorferi from 1980 to 1986; black-tailed jack rabbits (Lepus californicus) and desert cottontails (Sylvilagus audubonii) were sampled in 1986. Coyote fetuses, adult coyote kidneys, and black-tailed jack rabbit and desert cottontail kidneys were cultured for B. burgdorferi in 1986. Results of indirect immunofluorescent antibody (IFA) tests for B. burgdorferi in coyotes were as follows (number positive at a dilution of greater than or equal to 1:128/number tested): 1980 (0 of 30), 1981 (0 of 21), 1982 (0 of 53), 1983 (0 of 78), 1984 (47 of 97), 1985 (20 of 88), and 1986 (42 of 80). Eight of 26 black-tailed jack rabbits and two of seven desert cottontails tested in 1986 had IFA titers to B. burgdorferi of greater than or equal to 1:128. Borrelia burgdorferi was isolated from one of five coyote fetuses, three of 31 adult coyote kidneys, and two of 10 black-tailed jack rabbit kidneys in 1986. These results indicate that B. burgdorferi infection has been present in coyotes in Texas, at least since 1984 and that transplacental transmission occurs.