The stroma of fibroadenoma and phyllodes tumor usually consists of fibroblastic proliferation. Rarely the stroma contains bundles of smooth muscle. Pseudoangiomatous hyperplasia of the mammary stroma has been described in fibroadenomas. However, true benign vascular stroma has not been reported. We report a case of a 34-year-old Chinese woman who presented with a large mass occupying the entire left breast. Left mastectomy was performed and showed a large, well-circumscribed, lobulated, rubbery-firm tumor measuring 13 x 10 x 6 cm. Microscopic examination revealed a fibroepithelial tumor formed by an organoid pattern of ductal structures with a very striking stromal appearance composed of extensive vascular proliferation and that demonstrated strong immunoreactivity for CD31, CD34, and Factor VIII. Ultrastructural examination revealed intercellular junctions, basal lamina, pinocytotic vesicles, and Weibel-Palade bodies in the cells lining the vascular spaces, confirming their endothelial nature. These findings rule out the diagnosis of pseudoangiomatous hyperplasia. The patient developed local recurrence a year later, and the resection showed malignant phyllodes tumor with ductal carcinoma in situ. The extensive vascular stroma noted in the primary tumor may have played a role in the malignant transformation of the epithelial and stromal components in this tumor.