Unexpected aggression: Sheltie, 18 months old

Question
QUESTION: How do you stop aggression in an 18 month old Sheltie? One minute you can be petting her and the next minute she is biting your hand! If you accidentally step on her, she turns around and attacks your foot or leg. This is a rescue dog that has been in obedience training, has a large fenced yard and is owned by a couple that is in their late 70s. They love this dog, but cannot handle her aggression. She is also aggressive to other people in the family. Also, she has a TERRIBLE fit when she is crated and when family members leave. Help!

ANSWER: this dog has a terrible developing problem and you very well might be seeing the reason she is a "rescue" dog.  It appears from your description to be fear based (petting provokes aggression, suggesting physical abuse in the past). Although herding breeds can develop aggression problems, they are rarely dominance related.  Obedience training does not address behavior problems.  The dog is in an inappropriate home.  her owners, in their 70s, are not capable of dealing with such a serious problem, nor should they have to.  This behavior needs to be observed by a certified applied animal behaviorist.  I cannot ethically advise you in text because the dog needs to be evaluated carefully and its behavior closely observed.  The crating problem and separation anxiety issues are nothing compared to the aggression.  The dog is under enormous stress, is very fearful and insecure, and these people are not capable of doing the work required to fix these behaviors.  Contact the veterinary college in your geographical area and get referral to a behaviorist, Ph.D. or DVM.  Also, I assume the dog was adopted from some rescue organization.  Contact them immediately and report this problem; inquire what help they can offer in its correction, if this behavior was seen in any foster home she may have been in, any history you can obtain regarding her former home or the circumstances under which she came into rescue.  If this is a bona fide incorporated rescue organization, they should be willing to take her back.

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QUESTION: Let me add that she was adopted from the Animal Shelter at 4 months. We know she was kept in a washroom, was around small children. She also barks when she hears a baby crying, ambulances, buses, etc. This dog was adopted out of the loss of another animal. They thought she was cute, ect., and did not know anything about the breed. They love her, but do not know what else to do. I have recommended they remove her from their house and try to find her another home with someone who understands and knows the breed. They are torn with what decision to make. I just fear for the well-being of the owners.

Answer
This dog has an aggression problem.  it will be absolutely impossible to rehome her without divulging the problem behavior, and NO ONE will want such a dog.  If she has been in this home since the age of 4 months, THEY have created this problem behavior.  You need to locate a certified applied animal behaviorist and you need to do it soon.