We experienced a very rare case of parosteal lipoma, which was situated on the adjacent periosteum of the tibia with hyperostosis, as a bony reaction without due causes and mimicking parosteal osteosarcoma or osteochondroma in a 30 year old Korean housewife. The hyperostosis was limited on the cortex with no connection to the medullary canal. We reported the case because of it's rarity, and its specific magnetic resonance image findings. No local recurrence was observed in 14 months after marginal excision.