Avian colibacillosis resulting from avian pathogenic Escherichia coli (APEC) seriously disrupts poultry production. Hatcheries are the main source of chickens for commercial farms. To characterize the potential pathogenicity of E. coli strains isolated from hatcheries, 2344 fluff samples from 1-day-old chickens were collected from hatching incubators between October 2016 and November 2017. Among the hatcheries, the incidence of E. coli varied from 0% to 16.9%, with an overall incidence of 2.0%. High incidences reflected inadequate sanitation in some hatcheries. We also compared 20 clinically isolated APEC strains with fluff-originated E. coli in terms of existence of 10 virulence-associated genes (VAGs) and antimicrobial-resistance genes, and antimicrobial resistance using minimum inhibitory concentration (MIC) values. Our results showed that APEC more-frequently possessed most of the assessed VAGs (papC, astA, cvaC, hlyF, fyuA, iroN, iutA, iss, and ompT), suggesting that fluff-originated E. coli is less likely to cause avian colibacillosis. However, fluff-originated E. coli more-frequently expressed the adhesion gene fimC, which could confer higher upper respiratory tract adhesion. Both APEC and fluff-originated E. coli demonstrated multidrug resistance including 100% resistance to ampicillin, amoxicillin, cephalexin, florfenicol, and trimethoprim-sulfamethoxazole. Based on median MIC values, fluff-originated E. coli was more susceptible to antibiotics. However, resistance-gene existence did not significantly differ between groups, suggesting that fluff-originated E. coli should still be a public health concern. Molecular subtyping with XbaI-digested pulsed-field gel electrophoresis revealed that only a few strains showed identical patterns, indicating that a variety of contamination sources were present within individual hatcheries. Identical strains within the same hatchery may indicate vertical transmission from parent flocks. Overall, this is the first study to characterize fluff-originated E. coli. Our results suggest that it has lower pathogenicity than APEC and that thorough sanitation should be performed to reduce the occurrence of fluff-originated E. coli in hatcheries.