Proliferating tricholemmal cystic carcinoma must be distinguished from proliferating tricholemmal cystic acanthoma. The latter always is sharply circumscribed by a smooth border, whereas the former may display a jagged border, at least in a focus. The latter shows no crowding of atypical nuclei at the periphery of aggregations, whereas the reverse is true of the former. No mitotic figures are encountered in the latter, but they are invariable in the former. The carcinoma has marked predilection for the scalp; the acanthoma does not.

A second neoplasm that must be distinguished from proliferating tricholemmal cystic carcinoma is squamous-cell carcinoma. Although the two neoplasms have many features in common, for example, proliferation of spinous cells whose nuclei are atypical and whose cytoplasm is cosinophic, many dyskeratotic cells, nuclei in mitosis, and zones of abnormal cornification, the crucial finding that enables separation of them is differentiation toward tricholemmal sheath (at the isthmus and at the base of a follicle advanced in catagen) in proliferating tricholemmal cystic carcinoma. No such differentiation occurs ever in an authentic squamous-cell carcinoma. In foci, however, it may be impossible to distinguish findings in proliferating tricholemmal cystic carcinoma from those of squamous-cell carcinoma.