A case is reported of a combined neuroepithelial cyst and xanthogranuloma of the choroid plexus in the third ventricle of a 22-year-old woman. It is suggested that proliferated neuroepithelial cells lining the cyst enter the fibrous wall through the disrupted basal lamina, and then become xanthomatous cells. Disintegration of these foamy epithelial cells releases lipids and other materials into the cyst wall, provoking a response of macrophages and multinucleated giant cells of foreign-body type. A xanthogranuloma is then formed. The origin of "colloid" cysts is from neuroepithelium; these cysts arise from both ependyma and choroid plexus. Those cysts arising in or near the floor of the third ventricle may originate in stomodeal epithelium, but a distinction cannot be made from neuroepithelial cysts by presently available methods.

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