Ulnar artery aneurysms and pseudoaneurysms are rare lesions that usually occur distal to the wrist and cause symptoms as a result of embolization and not rupture. An elderly woman presented with acute rupture of an ulnar artery pseudoaneurysm proximal to the wrist, which caused severe neurologic compromise as a result of bleeding into Guyon's canal and the carpal tunnel. The patient had a remote wrist fracture resulting in a deformity that allowed the ulnar head to be in proximity to the ulnar artery. Rupture of the volar capsule with chronic abrasion of the artery eventually led to pseudoaneurysm formation and subsequent rupture. Emergency operative treatment with excision of the pseudoaneurysm, ulnar artery ligation, and repair of the volar capsule resulted in complete neurologic recovery without vascular compromise. This case is unique because of the proximal location of the pseudoaneurysm and the presentation with rupture. The anatomy, pathogenesis, and treatment options are discussed. Excision of the pseudoaneurysm with repair of the torn volar capsule is recommended to avoid recurrent problems. Vascular reconstruction is needed in cases where radial arterial flow is inadequate.