Biphasic breast tumors with benign ductal elements and a sarcomatous stroma lacking a phyllodes architecture are a source of diagnostic problems, particularly because of the lack of an appropriate designation. At the Armed Forces Institute of Pathology, we have used the term "periductal stromal sarcoma" to distinguish these from phyllodes tumors. All cases coded as periductal stromal sarcoma or PDSH were retrieved from the files of the Armed Forces Institute of Pathology. Cases that fulfilled the following criteria were included in this study. The histologic features of periductal stromal sarcoma were defined as 1) a predominantly spindle cell stromal proliferation of variable cellularity and atypia around open tubules and ducts devoid of a phyllodes pattern, 2) one or more often multiple nodules separated by adipose tissue, 3) stromal mitotic activity of >/=3/10 high power fields, and 4) stromal infiltration into surrounding breast tissue. Criteria for periductal stromal hyperplasia included 1) nodular, bland stroma growing as cuffs around normal or altered ducts, 2) no to minimal atypia, and 3) at most 0-2 stromal mitotic figures per 10 high power fields. Immunohistochemistry was used to further characterize these neoplasms. Of the cases retrieved, 20 qualified as periductal stromal sarcoma and seven as periductal stromal hyperplasia. Patients with periductal stromal sarcoma ranged in age from 37 to 89 years (mean 55.3 years). The tumors measured 0.2-6.0 cm (mean 2.97 cm). Eighteen patients had excisional biopsies and two had partial mastectomies. Overall follow-up time ranged from 1 to 72 months (mean 25.3 months) with two patients (10%) showing recurrence or probable metastasis. The neoplastic cells of periductal stromal sarcoma were at least focally immunoreactive for CD34 (13 of 15), CD117 (6 of 15), less reactive for actin (HHF35, 2 of 15), and negative for estrogen and progesterone receptors. Periductal stromal sarcoma is a useful descriptive designation for generally low-grade biphasic tumors with sarcomatous stroma that do not have features of a phyllodes tumor. The development of focal phyllodes pattern in the recurrent tumor as well as development of a specific soft tissue sarcoma in one of the above cases suggest that some and possibly all periductal stromal sarcoma may evolve into a phyllodes tumor with time. Given the presence of infiltrative margins, excision with a rim of uninvolved tissue is required.