Pilar cysts are derived from the outer layer of the root sheath of hair follicles. They were conventionally thought to arise from hair-bearing skin like the scalp. However, this notion has been refuted recently. Pilar cysts of the hand are extremely rare, with only a few case reports in the literature. We report the case of a 40-year-old male patient, with no known medical co-morbidities, who presented with a swelling over his left thumb. It was occasionally painful, and caused difficulty in grasping objects. Physical examination revealed a 2.5 x 1.5 cm swelling over the volar aspect of the thumb, at the level of the proximal phalanx. MRI revealed the presence of a well-defined cystic lesion superficial to the flexor tendons. The possibility of an epidermal cyst was considered, and the patient was advised surgery in view of his symptoms and progression in the size of the swelling. He underwent excision of the lesion along with a segment of adherent skin. Histopathological examination of the lesion revealed the presence of a pilar cyst. The patient did not have recurrence of symptoms following surgery, and was found to be doing well at the three-year follow-up. This case report urges a re-thinking of the possible origins of pilar cysts from atypical locations.