A type II congenital cystic adenomatoid malformation (CCAM II) occurring within an extralobar pulmonary sequestration (ELS) is described. This large malformation and accompanying pulmonary hypoplasia were diagnosed prenatally by ultrasound examination at 24-25 weeks gestational age. Based upon this diagnosis, the pregnancy was terminated. Autopsy revealed a 40.5 g supradiaphragmatic sequestration, severely hypoplastic lungs, and a hypoplastic heart. Morphologic and clinical features of both CCAM and ELS are compared. CCAM occurring within an ELS has been reported on at least twelve occasions. All the malformations in which the type was reported were of the less differentiated types II or III. We offer an explanation of this fact based on the timing of the embryologic maldevelopment.