A 23-year-old male affected of recessive dystrophic epidermolysis bullosa presented with a 2-month history of a growing verrucous plaque on the right flank. The clinical features and evolution suggested the diagnosis of cutaneous squamous cell carcinoma. Histopathological examination showed hyperkeratosis, parakeratossis, and verrucous acanthosis and numerous large xanthoma cells in the papillary dermis. Reflectance confocal microscopy disclosed the absence of epidermal atypia and the presence of aggregates of reflecting cells at dermal–epidermal junction and upper dermis. These cells were ultrastructurally characterized and corresponded to foamy histiocytes. Verruciform xanthoma is a benign reactive lesion that has occasionally been reported to develop in chronically eroded areas in patients with recessive dystrophic epidermolysis bullosa. In this group of patients, verruciform xanthoma may clinically mimic cutaneous squamous cell carcinoma and a correct diagnosis is crucial to avoid inappropriate aggressive therapeutic approaches. In vivo noninvasive image technologies such as reflectance confocal microscopy may be helpful diagnostic tools in this clinical setting.