Large congenital melanocytic nevi (LCMN) in neonates can cause considerable concern for parents, family members, and physicians. A detailed understanding of the medical risks, including cutaneous melanoma (CM), extracutaneous melanoma (ECM), and neurocutaneous melanocytosis (NCM), as well as the psychological stress that these lesions can cause in patients, will guide informed management decisions as well as provide comfort to parents. Current data indicate that LCMN greater than 20 cm, and more likely greater than 40 to 60 cm, are the lesions at greatest risk for complications such as CM, ECM, and NCM. Additionally, lesions on the trunk are at greater risk for developing CM, and LCMN in association with numerous satellite nevi are at greatest risk for NCM. Individualized management plans, including clinical observation, magnetic resonance imaging (MRI), and possibly surgery should be based on the risk versus benefit ratio, taking into account the size of the LCMN, its location, the number of satellite nevi, symptoms, and numerous other factors which will be reviewed. This paper will provide a detailed analysis of the risks associated with LCMN, as well as a discussion regarding management and treatment options.