A 2-year-old spayed female, German Shepherd dog was presented to the University of Illinois Veterinary Teaching Hospital with a history of intermittent lethargy. On physical examination, lung sounds were increased. The dog had a mild fever (103.7 degrees F) and mild tachycardia (120 bpm). Thoracic ultrasound revealed a sternal mass and pericardial effusion, both of which were aspirated. On cytologic examination, the pericardial fluid contained a large amount of blood and was interpreted as a hemorrhagic effusion. Nucleated cells consisted mainly of macrophages containing phagocytized RBCs and hemosiderin and many clusters of reactive mesothelial cells. The majority of mesothelial cells contained variable amounts of rod-shaped brown pigment granules that were suspected to be iron. The granules were positive for Prussian blue and carbol-fuschin, indicative of iron potentially mixed with lipofuscin. The granules stained negatively with Melan A, rhodamine, Hall's, and periodic acid-Schiff. The iron within the mesothelial cells was likely secondary to hemorrhage, based on the erythrophagia and accumulation of hemosiderin in macrophages. Iron deposition and phagocytic activity in mesothelial cells has been reported previously in humans and rats, but not in dogs.