Epithelioid hemangioendothelioma is a unique tumor of adult life which is characterized by an "epithelioid" or "histiocytoid" endothelial cell. Forty-one cases of this rare tumor have been recognized at the Armed Forces Institute of Pathology. They may occur in either superficial or deep soft tissue, and in 26 cases appeared to arise from a vessel, usually a medium-sized or large vein. They are composed of rounded or slightly spindled eosinophilic endothelial cells with rounded nuclei and prominent cytoplasmic vacuolization. The latter feature probably represents primitive lumen formation by a single cell. The cells grown in small nests or cords and only focally line well-formed vascular channels. The pattern of solid growth and the epithelioid appearance of the endothelium frequently leads to the mistaken diagnosis of metastatic carcinoma. The tumor can be distinguished from a carcinoma by the lack of pleomorphism and mitotic activity in most instances and by the presence of focal vascular channels. Ultrastructural study in four cases confirmed the endothelial nature of the tumor in demonstrating cells surrounded by basal lamina, dotted with surface pinocytotic vesicles, and occasionally containing Weibel-Palade bodies. Follow-up information in 31 cases indicated that 20 patients were alive and well following therapy; three developed local recurrences and six metastases. It is suggested the term epithelioid hemangioendothelioma be used to designate these biologically "borderline" neoplasms. The significance of the epithelioid endothelial cell is not entirely clear. Since it may be observed in both benign and malignant vascular lesions, its presence alone does not define a clinicopathologic entity.