BACKGROUND: Dengue is the most prevalent mosquito-borne virus, and potentially fatal dengue hemorrhagic fever (DHF) occurs mainly in secondary infections. It recently was hypothesized that, due to the presence of cross-immunity, the relationship between the incidence of DHF and transmission intensity may be negative at areas of intense transmission. We tested this hypothesis empirically, using vector abundance as a surrogate of transmission intensity. METHODOLOGY/PRINCIPAL FINDINGS: House Index (HI), which is defined as the percentage of households infested with vector larvae/pupae, was obtained from surveys conducted on one million houses in Thailand, between 2002 and 2004. First, the utility of HI as a surrogate of transmission intensity was confirmed because HI was correlated negatively with mean age of DHF in the population. Next, the relationship between DHF incidence and HI was investigated. DHF incidence increased only up to an HI of about 30, but declined thereafter. Reduction of HI from the currently maximal level to 30 would increase the incidence by more than 40%. Simulations, which implemented a recently proposed model for cross-immunity, generated results that resembled actual epidemiological data. It was predicted that cross-immunity generates a wide variation in incidence, thereby obscuring the relationship between incidence and transmission intensity. The relationship would become obvious only if data collected over a long duration (e.g., >10 years) was averaged. CONCLUSION: The negative relationship between DHF incidence and dengue transmission intensity implies that in regions of intense transmission, insufficient reduction of vector abundance may increase long-term DHF incidence. Further studies of a duration much longer than the present study, are warranted.