Although lipomas are the most common benign soft-tissue tumors, the intramuscular type is rare and the parosteal type is even rarer. These types of tumors can present like malignant tumors like liposarcoma. Unlike superficial lipomas, deep lipomas (intramuscular/parosteal) require magnetic resonance imaging to evaluate for and rule out malignant features. We report this patient with giant and mixed types of rarest lipomas (intramuscular and parosteal) that arise from the humeral periosteum and within the brachioradialis muscle with encasement of the radial nerve. We aimed to increase awareness to think outside the box and shed light on this giant, rarest mixed type of intramuscular and parosteal lipomas. Furthermore, it emphasizes the need for careful investigations to rule out malignant tumors like liposarcoma. Finally, many orthopedic oncology centers designate large, deep lipomas as low-grade liposarcoma due to the risk of local recurrence.