A rare case of extraventricular neurocytoma (EVN) arising from the VIIIth cranial nerve in a 34‐year‐old woman is reported. The patient had a 20‐year history of hearing loss and facial palsy. Computed tomography showed a 3‐cm enhancing lesion in the left cerebellopontine angle (CPA). At operation, the tumor was seen to originate from the cochlear and vestibular nerves. The tumor was subtotally resected. Histologically, the tumor consisted of uniform cells with oval to round nuclei and scant cytoplasm. Immunohistochemically, the tumor cells were positive for synaptophysin, but negative for glial fibrillary acid protein and S‐100 protein. The Ki‐67 labeling index was 0%. Twelve years after the operation, magnetic resonance imaging (MRI) showed tumor recurrence at the left CPA. The tumor was subtotally resected, and radiation therapy was given. Histologically, the tumor consisted of round cells with mild atypia and one mitosis/20 high‐power fields (HPF). Immunohistochemically, tumor cells showed the same findings as the first operation sample, except for the Ki‐67 labeling index (3%). Twelve years after the second operation, MRI showed a second tumor recurrence at the left CPA and surroundings of the brain stem. The tumor was subtotally resected. Histologically, the tumor consisted of anaplastic short spindle cells and five mitoses/10 HPF. The immunohistochemical findings were almost the same as the earlier operation samples. However, the Ki‐67 labeling index was 20%. In addition, tumor cells from the third specimen were more strongly and more diffusely positive for GAB1 (growth factor receptor‐bound protein 2‐associated binding protein 1) compared to those of the earlier specimens. Electron microscopy showed the presence of numerous cell processes with a dense core and clear vesicles and microtubules. GAB1 immunostaining also indicated that malignant progression might be associated with the sonic hedgehog signaling pathways. To the best of our knowledge, this is the first report of an EVN arising from the VIIIth cranial nerve with malignant progression.