A dengue-2 epidemic causing dengue hemorrhagic fever (DHF) occurred in the contiguous border cities of Matamoros, Tamaulipas (Mexico), and Brownsville, TX, in 2005. In December, we conducted a household-based epidemiologic survey to determine the incidence and seroprevalence of dengue infection among Matamoros and Brownsville residents and to identify risk factors associated with infection. Antibodies to dengue were measured in 273 individuals. The estimated incidence of recent dengue infection was 32% and 4% among Matamoros and Brownsville participants, respectively. The estimated prevalence of past dengue infection was 77% and 39% among Matamoros and Brownsville participants, respectively. The Breteau index was 28 in Matamoros and 16 in Brownsville, reflecting an abundant winter population of Aedes mosquitoes. Discarded waste tires and buckets were the two largest categories of infested containers found in both cities. Our results underscore the risk for epidemic dengue and DHF in the Texas-Mexico border region.