Background: Pleomorphic hyalinizing angiectatic tumor (PHAT) and hemosiderotic fibrolipomatous tumor (HFLT) are low-grade neoplasms that share clinicopathologic features and recurring translocation t(1;10)(p22;q24) involving the TGFBR3 and MGEA5 genes. Coexistence of these tumors with a high-grade sarcoma is exceedingly rare and the cytologic features have not been widely described in the literature. Case: A 55-year-old female presented with a soft tissue tumor on the dorsum of the foot. Cytologic smears and corresponding core biopsies were composed of a population of markedly pleomorphic spindle cells seen singly and in loose clusters within a myxofibrous matrix and infiltrating fat, with coarse chromatin, prominent nucleoli, irregular nuclear contours and delicate to vacuolated cytoplasm. Intracytoplasmic hemosiderin granules and rare intranuclear cytoplasmic pseudoinclusions were identified. The histologic features of the excisional biopsy mirrored those of the cytologic preparations, but also demonstrated cellular foci of higher-grade sarcoma composed of markedly pleomorphic tumor cells with large vesicular nuclei and prominent nucleoli, exhibiting a mitotic index of 12 mitotic figures per 10 high-powered fields. Conclusion: While HFLT/PHAT generally can be managed by wide local excision, it is important to be aware of their capacity to harbor higher-grade lesions with metastatic potential which may require more radical surgical excision.