Abstract Background Transformation of a cystic benign teratoma of the ovary into a "carcinosarcoma" has very rarely been reported and its histogenetic origin is still debated. Case presentation A case of carcinosarcoma arising from a dermoid cyst is reported. The tumor showed cystic areas delimited by normal squamous epithelium, with transitional areas through dysplastic epithelium to "in situ" and infiltrating squamous cell carcinoma (SCC). The sarcomatous component showed compact tissue composed of round cells concentrically arranged around small vessels, spindle, and pleomorphic cells with a high nuclear-cytoplasmic ratio. Positive staining for vimentin, alpha smooth muscle actin and CD10, as well as P53 and P63, was found in the sarcomatous component and in some atypical basal cells of the squamous epithelium, which also showed the usual epithelial markers. Conclusion To the best of our knowledge, this is the first case of carcinosarcoma arising from a dermoid cyst in which a histogenetic origin from totipotent stem cells, located in the basal squamous layer, is supported by immunohistochemical findings.