A question arose in our practice of whether all cysts considered sebaceous should be sent for pathologic evaluation. To address this controversial topic, we performed a retrospective study of our single institution's histopathology database. A natural language search of the CoPath database across the institution was undertaken using the diagnosis of sebaceous cyst, epidermal cyst, epidermoid cyst, epithelial cyst, infundibular cyst, pilar cyst, trichilemmal cyst, and steatocystoma. A surgical pathologic review of all specimens with one of these preexcision diagnoses was included in the 15-year retrospective study of 1998 to 2013. All slides were confirmed to have undergone histopathologic review, and the preexcision diagnoses were compared with the postexcision diagnoses. Chart review was undertaken in instances of a diagnosis of malignancy. A total of 13,746 samples were identified. Forty-eight specimens had histopathologic diagnosis of malignancy, for an incidence of 0.3% and with the most common malignancy being squamous cell carcinoma. Chart review showed that for all cases, the surgeons reported uncertainty with regard to the diagnosis because of history or physical characteristics, or both. In addition, a comprehensive literature review showed results consistent with our data and illustrated 19 cases during the past 10 years in which most of the findings were squamous cell carcinoma. We propose the recommendation that routine pathologic evaluation of sebaceous cysts is necessary only when clinical suspicion exists.