The encapsulated follicular variant of papillary carcinoma has become one of the most common diagnoses in thyroid tumor pathology. However, serious issues remain regarding the reproducibility of the diagnosis, its position in the scheme of thyroid neoplasms, and the clinical implications of the diagnosis. Strict morphologic criteria should be applied to its microscopic recognition, especially in regard to the nuclear features. The generally indolent behavior of this tumor should be recognized in order to avoid overtreatment.