Shiga toxin-producing Escherichia coli (STEC) is a significant cause of gastrointestinal infection and the haemolytic-uremic syndrome (HUS). STEC outbreaks are commonly associated with food but animal contact is increasingly being implicated in its transmission. We report an outbreak of STEC affecting young infants at a nursery in a rural community (three HUS cases, one definite case, one probable case, three possible cases and five carriers, based on the combination of clinical, epidemiological and laboratory data) identified using culture-based and molecular techniques. The investigation identified repeated animal contact (animal farming and petting) as a likely source of STEC introduction followed by horizontal transmission. Whole genome sequencing (WGS) was used for real-time investigation of the incident and revealed a unique strain of STEC O26:H11 carrying stx2a and intimin. Following a public health intervention, no additional cases have occurred. This is the first STEC outbreak reported from Israel. WGS proved as a useful tool for rapid laboratory characterization and typing of the outbreak strain and informed the public health response at an early stage of this unusual outbreak.