Keratoacanthoma can usually be distinguished from squamous cell carcinoma. However, some tumors share certain characteristics of both lesions. There is a large group of actinic keratoacanthomas cytologically identical to squamous cell carcinomas. In locations other than the ocular adnexae, conservative therapy is often recommended for keratoacanthomas since these lesions tend to regress spontaneously. Two patients with large periocular keratoacanthomas illustrate some of the diagnostic and therapeutic dilemmas related to rapidly growing potentially malignant lesions about the eye. Extensive tissue destruction and possible recurrence following excision favor definitive surgical therapy in these cases.