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Atypical lipomatous tumor (ALT)/well-differentiated liposarcoma (WDLPS) is a locally aggressive malignant mesenchymal neoplasm, resembling ordinary lipoma in many clinical aspects. This study investigates the value of expression of p16, an important cell cycle regulator, alone or in combination with MDM2, to distinguish the 2 entities. Fifty cases of lipomatous neoplasms, with cytogenetic results, from 45 patients were collected from the archives in Department of Pathology, University of Medicine and Dentistry of New Jersey/New Jersey Medical School during 1998 to 2006. These include 18 cases of deep-seated lipoma, 1 hibernoma, 1 lipoblastoma, and 30 cases of ALT/WDLPS. p16 was detected in 25/30 (83.3%) of ALT/WDLPS, and none (0/18) of the deep-seated lipomas (P<0.0000001, Fisher exact test). MDM2 was detected in 18/30 (60%) of ALT/WDLPS, and was negative in 0/18 of the deep-seated lipomas (P<0.0001, Fisher exact test). Combined together, 27/30 (90%) of ALT/WDLPS showed positive staining of either p16, MDM2, or both, whereas no staining was observed in all the deep-seated lipomas (P<0.0000001, Fisher exact test). The single case of hibernoma and lipoblastoma revealed p16+MDM2− phenotype. These results indicated that p16 is yet another marker which seems to be a valuable marker to differentiate ALT/WDLPS from deep-seated lipomas.