We report on a slowly growing malignant tumor of the nail bed epithelium in a 69-year-old male. On light microscopic examination, the tumor was composed of: (1) some small cysts filled with eosinophilic, amorphous keratin and lined by an atypical squamous epithelium devoid of a granular layer and (2) solid nests and strands of atypical keratinocytes filling the dermis and penetrating the phalangeal bone. Because the nail bed epithelium is comparable to the outer root sheath, or trichilemma of the hair follicle, and since the reported tumor showed some analogies with trichilemmal carcinoma, we suggest that this entity be designated 'onycholemmal carcinoma'. Disarticulation of the involved phalanx was performed and neither local recurrence nor distant metastasis was observed during 4 years of follow up.