Benign nerve sheath tumors of soft tissue can occasionally adopt unusual or unfamiliar morphologic appearances that may introduce difficulties for diagnosis, such as multinucleation, bizarre nuclei, intranuclear vacuoles, and other degenerative changes. Tumor cells adopting a signet-ring or lipoblast-like configuration, however, are mostly associated with epithelial malignancies, liposarcoma and melanoma, and have been only rarely observed in spindle cell tumors of soft tissue. We report 5 cases of benign nerve sheath neoplasms that displayed prominent signet-ring cells with lipoblast-like features. The cases presented as solitary soft tissue masses in the groin, thigh, retroperitoneum, and shoulder in 4 men and 1 woman between the ages of 31 to 57 years. Four tumors predominantly showed features of schwannoma and one of neurofibroma; however, intimately admixed with the spindle cell population, there were also numerous scattered mature adipocytes as well as lipoblast-like cells displaying a signet-ring cell appearance. Immunohistochemical studies showed strong S-100 protein positivity in the spindle cells as well as in the signet-ring lipoblast-like cells and the mature adipocytes. The signet-ring cells were negative for mucin stains, cytokeratin, EMA, CEA, and several other differentiation markers. Ultrastructural examination was performed in 2 cases. The signet-ring cells contained large cytoplasmic lipid droplets that displaced the nuclei to the periphery, consistent with lipoblastic differentiation, whereas complex, interdigitating cytoplasmic processes covered by basal lamina material characteristic of nerve sheath differentiation could be identified in the spindle cells. Four patients for whom follow-up was available were alive and well with no evidence of recurrence over a period of 28 to 116 months (median follow-up, 50 months). The presence of mature fat and signet-ring lipoblast-like cells within a nerve sheath neoplasm is quite rare and may signify a process of aberrant differentiation. Neurogenic tumors should be added in the differential diagnosis of spindle cell tumors capable of displaying prominent signet-ring cell features.