Sarcomas, particularly undifferentiated small round cell sarcomas of bone and soft tissue, pose significant diagnostic challenges due to their nonspecific morphology and the necessity for comprehensive molecular analyses. This paper discusses a rare case of round cell sarcoma exhibiting the EWSR1-CREM fusion, offering insights into the complexities of its diagnosis and management. The patient, a 15-year-old female with a history of Type 1 diabetes, presented with persistent right thigh tenderness and swelling. MRI revealed a large necrotic mass in the retroperitoneal region. Histological analysis showed a well-demarcated tumor with diverse cellular morphologies and distinct necrotic areas. Immunohistochemical (IHC) tests identified dot-like staining for Desmin and Vimentin but negative results for several markers, including Cytokeratin and CD45. Strong ALK positivity was noted. Next-generation sequencing with the Illumina TruSight™ Oncology 500 assay revealed the fusion gene EWSR1-CREM, along with benign and uncertain mutations in other genes. The tumor’s morphology and immunoprofile, along with molecular findings, led to a diagnosis of round cell sarcoma with EWSR1-CREM fusion. This case adds to the spectrum of tumors associated with this fusion, often presenting diverse morphologies. The rarity of EWSR1-CREM fusion sarcomas poses a challenge in treatment, highlighted by the development of pulmonary metastases and disease progression after surgical excision in this patient despite the lack of an effective targeted therapy. In conclusion, this case emphasizes the need for a multidisciplinary diagnostic approach in complex sarcomas and highlights the importance of continued research on rare sarcomas, their genetic underpinnings, and potential therapeutic targets.