A previously unreported bacterial disease on chili pepper (Capsicum annuum L.) seedlings affecting as many as 4% of seedlings was observed in greenhouses in Chihuahua, Mexico (Delicias and Meoqui counties). Initial lesions appeared as irregular small spots on leaves and brown necrosis at margins tips were observed. Later, the spots became necrotic with a chlorotic halo. Advanced disease was associated with defoliation. A Gram negative, rod-shaped bacterium was isolated from diseased chili pepper seedlings. Three inoculation methods revealed that isolated strains produce foliage symptoms, similar to those observed in naturally infected seedlings. Pathogenic strains that caused symptoms in inoculated seedlings were re-isolated and identified to fulfill kochs postulate. Polyphasic approaches for identification including biochemical assays (API 20E and 50CH), carbon source utilization profiling (Biolog) and 16S rDNA, hsp60 and rpoB sequence analysis were done. Enterobacter cloacae was identified as the causal agent of this outbreak on chili pepper seedlings.