In Brazil, 4.5% of the AIDS-related opportunistic infections are caused by Cryptococcus neoformans. This pathogen is a ubiquitous environmental basidiomycetous encapsulated yeast, commonly found in soil and avian excreta. The present study investigates further the population structure of clinical and environmental C. neoformans isolates from south Brazil. One hundred five clinical and 19 environmental (pigeon excreta and Eucalyptus spp.) isolates from the Brazilian state Rio Grande do Sul were characterized based on morphological, biochemical, molecular and serological data. The majority of the clinical and environmental isolates analyzed belonged to C. neoformans var. grubii serotype A (89.5 and 52.6%, respectively), were mating type alpha (98.1 and 94.7%, respectively) and were phospholipase-positive (94.3 and 73.7%, respectively). PCR-fingerprinting with the microsatellite-specific primer M13 and the minisatellite-specific primer (GACA)(4) grouped the majority of the isolates into the molecular type VNI (89.5 of the clinical and 52.6% of the environmental isolates). Our results add considerable new information to the few available data on ecology, molecular biology and epidemiology of C. neoformans in the southern region of Brazil.