We report results of a Chandra observation of the X-ray luminous star-forming galaxy Arp299 (NGC3690/IC694). We detect 18 discrete X-ray sources with luminosities above ~10^39 ergs (0.5-8.0 keV band), which contribute ~40% of the total galactic emission in this band. The remaining emission is associated with a diffuse component spatially coincident with regions of widespread star-formation. We detect X-ray emission from both nuclei. One of the discrete sources within the complex nuclear region of NGC 3690 is found to have a very hard spectrum and therefore we associate it with the origin of the AGN-like spectrum that has also been detected at high X-ray energies using Beppo-SAX.
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