Mature cystic teratomas of the ovary are one of the most common ovarian neoplasms found in reproductive age women. The most common type of malignancy associated with ovarian mature cystic teratomas is squamous cell carcinoma. The frequency of this type of malignant degeneration is age related and is most common in the fifth and sixth decade of life. A case of a squamous cell carcinoma which developed in a mature cystic teratoma in a 25-year-old female is presented and issues regarding the diagnosis and management of this rare complication are discussed.