Cystic degeneration in thymoma is a relatively frequent but focal event. In rare cases, the process proceeds to the extent that most or all of the lesion becomes cystic. The authors studied ten cases of thymoma undergoing cystic degeneration of such degree that the lesions initially were mistaken grossly and microscopically for nonneoplastic thymic cysts. The patients' ages ranged from 23 to 81 years, and the sex distribution was equal. The lesions were characterized by the formation of multiple large cystic cavities filled with clear, hemorrhagic or grumose material. Histologically, residual solid islands showing the characteristic features of thymoma, i.e., biphasic cell population (epithelial cells/lymphocytes), perivascular spaces, and areas of medullary differentiation, were present within the cyst walls. In contrast with nonneoplastic thymic cysts, the walls of the cavities generally were devoid of an epithelial lining; most of the cysts appeared to predominantly result from extreme dilatation and confluence of perivascular spaces. In some instances, the cystic degeneration of the tumor was accompanied by cystic changes of an inflammatory nature in the surrounding, nonneoplastic thymic tissue leading to firm adhesions and apparent infiltration of adjacent mediastinal structures. None of the lesions in the studied patients recurred during follow-up periods of from 2 to 10 years (average follow-up, 5 years). Cystic thymomas should be distinguished from nonneoplastic congenital and acquired thymic cysts and other primary thymic neoplasms undergoing extensive cystic degeneration. It is important not to misinterpret the apparent infiltration of surrounding mediastinal structures that results from the inflammatory changes that often accompany these tumors as evidence of aggressive or malignant behavior.