We present the case of a peripheral nerve sheath tumor arising from the sciatic nerve in the thigh of a 42-year-old woman. Histologically, the tumor was composed of fascicles of spindle cells with extremely attenuated cytoplasmic processes. Regions of the tumor were heavily mineralized and fibrotic. The tumor was epithelial membrane antigen-positive and S100-negative. Staining for Leu-7 was positive in a patchy distribution. Type IV collagen was present between cells, and CD34 was negative in the tumor cells. Ultrastructural features included elongate cellular processes surrounded by discontinuous basal lamina and collagen. The features of the tumor therefore meet criteria for perineurioma. This rare tumor is found most often in the extremities in middle-aged woman. To our knowledge, the presence of bone formation in a perineurioma has not been described previously. The differential diagnosis includes other peripheral nerve sheath tumors, low-grade fibrous tumors, and synovial (monophasic) tumors. Evidence provided by electron microscopy and immunohistochemistry supports the diagnosis and classification of this unusual nerve sheath tumor as perineurioma with ossification. These findings expand our knowledge and criteria for classifying peripheral nerve sheath tumors.