Balloon cells are altered melanocytes with clear vacuolated cytoplasm caused by a defect in the process of melanogenesis. Although rare, balloon cell change has been observed in a variety of melanocytic proliferations, particularly intradermal melanocytic nevi and melanoma. When present, such features may lead to difficulties in diagnosis, particularly with other clear cell neoplasms. We report an unusual case of the development of balloon cell change in a cellular blue nevus, a phenomenon that has not been extensively addressed in the literature. The importance of recognizing this change in cellular blue nevus to avoid misinterpreting the lesion as malignant is discussed.