An intrahepatic biliary cystadenocarcinoma in a 56-yr-old white man was characterized by pronounced oncocytic differentiation. Grossly the tumor was a well-demarcated cyst filled with numerous branching papillary fronds. Most tumor cells had abundant granular, intensely eosinophilic cytoplasm on light microscopic examination and large numbers of densely packed mitochondria by electron microscopy. Mucin-secreting cells were also present. The patient returned 20 mo after resection of the primary tumor with recurrent tumor in the liver and widely disseminated disease throughout the abdominal cavity, and he died 5 mo later. Although less differentiated, the recurrent tumor again contained greatly increased numbers of mitochondria. The partial loss of oncocytic differentiation in the evolution of the present case and the benign nature of purely oncocytic tumors suggest that in the presence of mixed histologic features the potential for tumor progression is primarily determined by the lesser differentiated or nononcocytic component. To the best of our knowledge, oncocytic differentiation has not been previously described in biliary neoplasia.