BACKGROUND: Little is known about the prevalence of HIV or HCV in injecting drug users (IDUs) in Serbia and Montenegro. We measured prevalence of antibodies to HIV (anti-HIV) and hepatitis C virus (anti-HCV), and risk factors for anti-HCV, in community-recruited IDUs in Belgrade and Podgorica, and determined the performance of a parallel rapid HIV testing algorithm. METHODS: Respondent driven sampling and audio-computer assisted survey interviewing (ACASI) methods were employed. Dried blood spots were collected for unlinked anonymous antibody testing. Belgrade IDUs were offered voluntary confidential rapid HIV testing using a parallel testing algorithm, the performance of which was compared with standard laboratory tests. Predictors of anti-HCV positivity and the diagnostic accuracy of the rapid HIV test algorithm were calculated. RESULTS: Overall population prevalence of anti-HIV and anti-HCV in IDUs were 3% and 63% respectively in Belgrade (n = 433) and 0% and 22% in Podgorica (n = 328). Around a quarter of IDUs in each city had injected with used needles and syringes in the last four weeks. In both cities anti-HCV positivity was associated with increasing number of years injecting (eg Belgrade adjusted odds ratio (AOR) 5.6 (95% CI 3.2-9.7) and Podgorica AOR 2.5 (1.3-5.1) for >or= 10 years v 0-4 years), daily injecting (Belgrade AOR 1.6 (1.0-2.7), Podgorica AOR 2.1 (1.3-5.1)), and having ever shared used needles/syringes (Belgrade AOR 2.3 (1.0-5.4), Podgorica AOR 1.9 (1.4-2.6)). Half (47%) of Belgrade participants accepted rapid HIV testing, and there was complete concordance between rapid test results and subsequent confirmatory laboratory tests (sensitivity 100% (95%CI 59%-100%), specificity 100% (95%CI 98%-100%)). CONCLUSION: The combination of community recruitment, ACASI, rapid testing and a linked diagnostic accuracy study provide enhanced methods for conducting blood borne virus sero-prevalence studies in IDUs. The relatively high uptake of rapid testing suggests that introducing this method in community settings could increase the number of people tested in high risk populations. The high prevalence of HCV and relatively high prevalence of injecting risk behaviour indicate that further HIV transmission is likely in IDUs in both cities. Urgent scale up of HIV prevention interventions is needed.