OBJECTIVES To identify determinants of carriage of resistant Staphylococcus aureus in both hospitalized patients and individuals from the community in two urban centres in Indonesia. METHODS Staphylococcus aureus cultures and data on recent antibiotic use, demographic, socioeconomic, disease-related and healthcare-related variables were collected from 3995 community dwellers and hospitalized persons. Nasal S. aureus carriage was found in 362 persons (9.1%). Logistic regression analysis was performed to identify which variables were independently associated with carriage of resistant S. aureus. RESULTS The penicillins were the most frequently used antibiotics both in the community and in hospitalized patients. In the community, admission to a hospital was associated with carriage of S. aureus resistant to any of the tested antibiotics [odds ratio (OR) 2.5, 95% confidence interval (95% CI) 1.3-4.9] and any tetracycline resistance (OR 2.4, 95% CI 1.1-5.1). Having no symptoms was associated with less carriage of S. aureus with resistance to any of the tested antibiotics (OR 0.5, 95% CI 0.3-0.9) and any tetracycline resistance (OR 0.5, 95% CI 0.3-0.9). Crowding (OR 4.5, 95% CI 1.2-4.9) and low income (OR 8.9, 95% CI 1.8-43.9) were associated with multidrug resistance. In hospitalized patients, the use of penicillins was associated with resistance to any of the tested antibiotics (OR 3.9, 95% CI 1.4-11.6) and any tetracycline resistance (OR 3.7, 95% CI 1.1-12.0). CONCLUSIONS Antibiotic policies including proper diagnosis, treatment and drug delivery process should be made by healthcare providers in Indonesia to help limit the emergence of antibiotic resistance.