A unique case of parosteal osteosarcoma (POS) of the proximal femur, with areas of telangiectatic dedifferentiation, in a 28-year-old woman is reported. The patient had a 7-week history of pain and swelling in her right thigh. A biopsy diagnosis of POS was established. The patient was treated with two cycles of intraarterial chemotherapy, followed by limb salvage surgery. Histological examination of the resected specimen showed POS with areas of dedifferentiation composed of highgrade telangiectatic osteosarcoma with associated secondary aneurysmal bone cyst change.