Tanycytic ependymomas are a subtype of ependymomas that were formally recognized as a new pathological entity in the latest World Health Organization (WHO) classification of 2000. They occur mostly in the spinal cord. Only a few reports have analyzed the proliferative potentials of these tumors; however, it has been reported that the MIB-1 labeling index of tanycytic ependymoma is lower than that of other subtypes of WHO grade II ependymomas. We report a rare case of cervicomedullary junction tanycytic ependymoma associated with marked cyst formation. A 62-year-old man had a history of progressive gait disturbance, diplopia, and swallowing disturbance over a one-month period prior to admission. Magnetic resonance imaging (MRI) showed a cystic mass with a mural nodule at the cervicomedullary junction with Gd-DTPA enhancement. Cyst-subarachnoid shunt was performed using a far lateral approach. After 6 years, however, the man was readmitted to the hospital because of reaccumulation of the cyst. Partial removal of a mural nodule and a cyst-subarachnoid shunt were performed simultaneously by a midline suboccipital approach. The pathological diagnosis was tanycytic ependymoma. Postoperatively, the patient recovered well and was discharged from the hospital without further treatment. Most of the tumor cells had small, round nuclei; pleomorphism was minimal. The cytoplasm was dilated. The tumor cells were positive for EMA and s-100, and negative for CD-34. GFAP was not determined due to difficulty caused by background glial processes. The MIB-1 labeling index was less than 1%. Ultrastructurally, the tumor cells had ependymal cell features, such as desmosomes and microvilli. Based on these findings, the pathological diagnosis was tanycytic ependymoma.