Staphylococcus aureus is an opportunistic pathogen and variable component of the human microbiota. In atopic eczema (AE) a characteristic of the disease is colonization by S. aureus, with exacerbations associated with an increased bacterial burden of the organism. Despite this, the origins and genetic diversity of S. aureus colonizing individual patients during AE disease flares is poorly understood. To examine the micro-evolution of S. aureus colonization we have deep-sequenced S. aureus populations from nine children with moderate to severe AE, and 18 non-atopic children asymptomatically carrying S. aureus nasally. Colonization by clonal S. aureus populations was observed in both AE cases and controls, with all but one of the individuals containing colonies belonging to a single sequence type. Phylogenetic analysis revealed that disease flares were associated with the clonal expansion of the S. aureus population, occurring over a period of weeks to months. There was a significant difference in the genetic backgrounds of S. aureus colonizing AE patients versus controls (Fisher’s Exact test, p=0.03). Examination of intra-host genetic heterogeneity of the colonizing S. aureus populations identified evidence of within-host selection in the AE patients, with AE variants being potentially selectively advantageous for intracellular persistence and treatment resistance.