OBJECTIVE: To assess the impact of the AIDS epidemic on mortality and household mobility before and after death. DESIGN: Open community cohort study with a demographic surveillance system and two sero-epidemiological surveys. METHODS: Ten rounds of demographic surveillance were completed during 1994-1998 in the study area, which has a population of about 20 000 people in a rural ward in north-west Tanzania. Households with deaths were visited for a detailed interview, including a verbal autopsy. Data on HIV status were collected in two surveys of all residents aged 15-44 years. RESULTS: Mortality rates among HIV-infected adults were 15 times higher than those among HIV-negative adults and HIV/AIDS was associated with nearly half of deaths at ages 15-44 years. Verbal autopsies without HIV test results considerably underestimated the proportion of deaths associated with HIV/AIDS. The mortality probability between 15 and 60 years was 49% for men and 46% for women and life expectancy was 43 years for men and 44 years for women. By their second birthday nearly one-quarter of the newborns of HIV-infected mothers had died, which was 2.5 times higher than among children of HIV-negative mothers. Mobility of household members before and after death was high. In 44% of households in which the head died all members moved out of the household. CONCLUSIONS: In this rural population with HIV prevalence close to 7% among adults aged 15-44 years during the mid-1990s, HIV/AIDS is having substantial impact on adult mortality. A common response to death of a head of household in this community is household dissolution, which has implications for measurement of the demographic and socio-economic impact of AIDS.