A solitary tumor which by light microscopy was classified as a neurofibroma was found by electron microscopic study to be composed of parallel, elongate cells with collagen rich intervening matrix. The cells showed thin, polar cytoplasmic processes which extended long distances, frequent junctional complexes between cell processes, numerous surface vesicles, and either no or fragmented and variable basement membrane. Perineurial cells from small peripheral nerves of skin were demonstrated to have similar morphologic characteristics as the tumor cells. The present study, together with previous ultrastructural findings, indicate that benign peripheral nerve sheath tumors should be placed in at least three categories: Schwannoma, neurofibroma and perineurioma.