Squamous cell carcinoma is the second most common cutaneous malignancy. The diagnosis can occasionally be difficult as there are many lesions that are mimics, clinically and on pathologic examination. One of the most challenging lesions to differentiate from squamous cell carcinoma is pseudoepitheliomatous hyperplasia, a reactive proliferation of the epidermis that can be encountered secondary to a variety of inflammatory and neoplastic conditions. Utilizing the data set from our previously performed DNA microarray studies on formalin-fixed and paraffin-embedded tissue, we found that the genes C15orf48 and KRT9 had a distinct and robust gene expression pattern in distinguishing squamous cell carcinoma from pseudoepitheliomatous hyperplasia. C15orf48 had higher expression than KRT9 in squamous cell carcinoma, but lower expression than KRT9 in pseudoepitheliomatous hyperplasia. We developed and blindly validated a multiplex TaqMan PCR assay that utilizes these two highly discriminatory genes, which can be performed on material extracted from formalin-fixed and paraffin-embedded tissue. The TaqMan assay was able to differentiate squamous cell carcinoma from pseudoepitheliomatous hyperplasia in 54 of 58 cases (93%). Squamous cell carcinoma was accurately identified in 27 of 28 cases (96%); pseudoepitheliomatous hyperplasia in 27 of 30 cases (90%). This multiplex TaqMan PCR assay may be used as a helpful ancillary molecular diagnostic test to accurately distinguish squamous cell carcinoma from pseudoepitheliomatous hyperplasia in challenging cases.