Kaposiform hemangioendothelioma is a rare pediatric neoplasm that presents most commonly in the soft tissues. We report the case of a 1-month-old infant who presented with stridor and was found to have a diffusely infiltrating tumor in the thymus that extended into the pericardium and up the carotid sheaths. Histologic examination revealed a vascular tumor infiltrating among the lobules of the lymphocyte-depleted thymus. The lesion had features of both a capillary hemangioma and Kaposi sarcoma. Immunoperoxidase studies on formalin-fixed, paraffin-embedded tissue demonstrated the neoplastic endothelial cells to be positive for vascular markers CD31 and CD34. Antibody to factor VIII-related antigen labeled feeding vessels, but failed to stain the lobules of tumor. Although these tumors have been treated in a fashion similar to capillary hemangiomas in the past, it may be important to differentiate Kaposiform hemangioendotheliomas because of their association with Kasabach-Merritt syndrome and recent success with more aggressive chemotherapy regimens.