Atypical fibroxanthoma (AFX) is a nodular dermal ulcerative lesion with a favorable prognosis. AFX most commonly occurs on sun-exposed skin in elderly individuals. AFX is characterized by its association with ultraviolet radiation, not only from a clinical aspect, but also from a molecular aspect. Making a diagnosis of AFX is challenging, and it is important to differentiate it from squamous cell carcinoma and malignant melanoma. Histological features and combined immunohistochemical markers are necessary for a definitive diagnosis (i.e., an absence of immunostaining for cytokeratins, S100 and HMB45 in AFX is helpful for excluding both squamous cell carcinoma and malignant melanoma). AFX, as well as MFH (malignant fibrous histiocytoma), is a fibrohistiocytic lesion with myofibroblastic differentiation. AFX is considered to be a different lesion from MFH. AFX and MFH might share the same pathway which determines their morphology. However, they may have different pathways in development which determine their biological behavior.