An unusual encapsulated medullary carcinoma of the thyroid is reported. Immunocytochemistry and electron microscopy did not prove conclusively the cytogenesis of the tumor; however, in situ hybridization, by demonstrating the presence of calcitonin mRNA, revealed that the tumor is of C-cell derivation. Because these tumors have an unpredictable biologic behavior, it seems more appropriate to designate them as encapsulated medullary carcinoma than as C-cell adenoma. Immunocytochemistry for calcitonin and carcinoembryonic antigen as well as flow cytometry for DNA ploidy may be valuable techniques to assess prognosis of these tumors.