Nests of cells resembling urothelium, eponymously named “Walthard nests,” are well-known incidental findings over the fallopian tube and occasionally undergo cystification resulting in clinical detection and surgical removal. Only rarely is this process noted outside the pelvic peritoneum. Herein we describe cystic Walthard nests occurring in the diaphragmatic peritoneum of three patients (aged 25, 36, and 39 yr) undergoing surgical evaluation for presumed endometriosis. In each case, small pearly white nodules on the diaphragmatic peritoneum were noted and biopsied. Microscopic examination revealed cystic spaces filled with pale eosinophilic secretion. The cysts were lined mostly by stratified transitional cells with pale eosinophilic to focally clear cytoplasm. Umbrella cells were focally present in all cases, and 1 showed focal glandular differentiation resembling cystitis glandularis. In areas, the epithelial cells became flattened and attenuated and nuclei were bland. By immunohistochemistry, all were positive for GATA3, cytokeratin 7, and BEREP4 and negative for cytokeratin 20, estrogen receptor, and WT-1. Walthard nests can rarely occur outside the pelvic peritoneum where they may be noted incidentally during surgery for other indications. This should be readily distinguished pathologically from other peritoneal lesions but lack of significant prior comment of them occurring on the diaphragm may result in diagnostic difficulty.