Lipofibromatous hamartoma is a rare tumour-like condition involving the peripheral nerves, particularly the median nerve. It commonly affects the volar aspect of the hands, wrists and forearms of young adults. Most patients present either early with macrodactyly or later with a forearm mass lesion or symptoms consistent with compressive neuropathy of the involved nerve. The clinical and histomorphological findings of five patients with lipofibromatous hamartoma of the median nerve are analysed. The presentation, pathological features and differential diagnosis of neural lipofibromas are discussed along with a brief review of the literature. Of the five cases of lipofibromatous hamartoma, all were seen to involve the median nerve, occurring in four women and one man. Three of these cases had associated macrodactyly which was congenital in two and was seen from childhood in one. Microscopic examination showed fibrofatty tissue surrounding and infiltrating along the epineurium and perineurium. The nerve bundles were splayed apart by the infiltrating adipose tissue. Neural fibrolipomatous hamartoma is a benign condition. Most respond to conservative management with surgical exploration, biopsy and carpal tunnel release to decompress the nerve. Correct diagnosis of this uncommon lesion is important as surgical excision of the lesion may lead to loss of neurological function.