Dedifferentiated liposarcoma (DDL) has been defined as a tumor composed of well-differentiated liposarcoma (WDL) associated with or progressing to a nonlipogenic, high-grade sarcoma. One might expand this definition of DDL to include low-grade dedifferentiation (LGDD), because tumors with LGDD alone are capable of metastasizing. We studied 20 cases of retroperitoneal WDL with or without LGDD and/or high-grade dedifferentiation (HGDD) to semiquantitate the amount of WDL, LGDD, and HGDD in each case and to correlate the amounts of these components with clinical outcome. For each case, a composite estimate of each of these components was obtained. Thirteen patients (65%) of 20 had an adverse outcome (AO). Within this group, metastatic disease developed in 3 patients, 2 of whom had areas of HGDD (40% and 20%) in their initial excisions, whereas 1 patient had 30% LGDD and 0% HGDD. Of the patients with AOs, 12 (92%) had LGDD areas, 4 (31%) had HGDD areas, and 1 (8%) had pure WDL. Of the seven patients without AOs, three had recurrences, but metastatic disease did not develop in any. All of these seven patients had some element of WDL, five (71%) had LGDD areas, two (29%) had HGDD areas (20% in both cases), and two (29%) had pure WDL. There was no significant difference in clinical outcome between those patients with WDL and those with WDL/LGDD or WDL/LGDD/HGDD. We conclude that recurrences develop in most patients with retroperitoneal WDL and that most of these patients die as a result of local effects of the tumor. Metastases are rare and may occur in patients with tumors with either LGDD, HGDD, or both but do not occur in pure WDL. Neither the amount of LGDD nor HGDD correlates with clinical outcome. LGDD areas, as defined in this study, are commonly seen in de novo retroperitoneal WDLs.