Background Acromioclavicular (AC) joint cysts are relatively rare. There are two distinct etiologies of AC cysts. Type 1 is isolated to the AC joint, while type 2, is related to a tear or rupture of the rotator cuff (RC). The disease is usually a rare result of advanced AC joint arthritis or RC-tear arthropathy. Patients may present with signs and symptoms of RC impingement and tear. Conservative management may be used initially in asymptomatic individuals who are also not concerned with cosmesis. Aspiration and steroid injection of the cyst has been reported as one method of non-surgical management of these lesions, however, there is a high rate of recurrence. Case Presentation We report a case of A 72-year-old right-handed female with past medical history of type two diabetes mellitus, chronic smoking, and a prior right RC repair with distal clavicle resection who presented with an AC joint cyst complicated by a draining fistula as a result of cyst aspiration and steroid injection. Due to the persistent drainage of the cyst and concern for infection, the patient was treated with a staged reverse shoulder arthroplasty given the setting of an irreparable rotator cuff tear and end-stage cuff-tear arthropathy. Conclusion This case demonstrates an important complication of persistent draining fistula resulting from AC joint cyst aspiration and steroid injection in the setting of advanced RC-tear arthropathy. In immunocompromised patients, staged reverse shoulder arthroplasty should be considered for treatment of these draining fistulas especially when the concern for periprosthetic infection is high.