Some authors have used sebaceous epithelioma as a synonym for basal cell carcinoma (BCC) with sebaceous differentiation. However, our review of the literature revealed that definite cases of BCC with sebaceous differentiation that provide adequate clinical and histopathologic information are scarce. We present the case of a 72-year-old woman with a pigmented nodular lesion on her right ala nasi region, clinically diagnosed as pigmented BCC. Histopathologically, this nodular lesion, which was completely excised, showed typical features of BCC. It was noteworthy that within one aggregation of the presented BCC, tiny and small duct-like structures lined by cornified layers with a crenulated inner surface were seen. Vacuolated cells were scattered within a few aggregations, and they had foamy, bubbly cytoplasm and starry nuclei. The vacuolated cells were immunohistochemically positive for epithelial membrane antigen (EMA). These histopathologic findings demonstrated unquestionable sebaceous differentiation in this BCC, namely BCC with sebaceous differentiation, which should be distinguishable from both sebaceoma and sebaceous carcinoma. The small duct-like structures lined by eosinophilic cuticle, indicating apocrine differentiation, were also observed in this BCC.