Introduction: Congenital soft tissue tumors are uncommon; proper diagnosis calls for histopathological experience and ancillary techniques based upon immunohistochemial, cytogenetic, and molecular biology. Following excision, intermediately aggressive soft tumors tend to local recurrence, which significantly impacts prognosis; some cases occur close to malignity; subsequently, diagnostic implications are enormous for the patient. Case report: A 26-day old neonate with a posterior left thigh mass entered hospital. Initial biopsy analysis could not rule out either striated muscle origin or malignancy; resection and classification of surgical piece followed. Pursuant to resection, using immunohistochemistry panel, tumor analysis and classification took place. Conclusion: Soft tumor diagnosis is a complex process, even more so for newborns. Infrequent occurrence requires that examiners have ample histopathological experience in the handling of ancillary techniques. Furthermore, as in lipofibromatosis, determining the presence of trapped vs. malignant tissue hinders proper classification, which, in turn, has profound implications for the patient. We include a standard diagnostic algorithm based on clinical and histological characteristics for this type of congenital lesions.