We present the case of an elderly man with chronic obstructive pulmonary disease who had a 4-month history of multiple fluctuant masses of the dorsum of the right hand, which began at the site of an intravenous catheter. Medications included inhaled and oral steroids. Fungal cultures of the fluid obtained grew a pigmented mold identified as Exophiala species after several routine cultures were reported as negative. The patient underwent radical excision of the masses and received a perioperative course of oral itraconazole. This is one of the first known cases of a possible nosocomially acquired phaeomycotic cyst. Unusual fungi should be considered in the differential diagnosis of skin lesions in immunocompromised patients.