Hydrocele of the canal of Nuck is one of the rarest clinical entities in the female population. It occurs due to the failure of obliteration of the processus vaginalis, which is the extension of the parietal peritoneum. Hydrocele may be seen, along with associated inguinal hernia. It usually presents with painless inguinal unilateral or bilateral swellings, and is sometimes associated with features of intestinal obstruction if the hernia becomes incarcerated or obstructed. Ultrasonography of the abdomen and pelvis and magnetic resonance imaging provide the diagnosis, if these imaging modalities are available; however, definite diagnosis may only be made during surgery. Definitive treatment includes open/laparoscopic excision of the cyst with high ligation of the neck up to the peritoneal pouch, along with repair of the inguinal hernia, if present. We present a rare case of a 25-year-old woman who presented with bilateral inguinolabial swelling, clinically diagnosed as bilateral irreducible inguinal hernia. Intraoperatively, polycystic swelling with serous content was observed along with associated indirect inguinal hernia containing omentum on the left side. She was treated with removal of the cystic component of the bilateral canal and tissue repair of the left indirect inguinal hernia.