Causes of meralgia paresthetica. Meralgia paresthetica is caused by nerve entrapment. The lateral femoral cutaneous nerve running through your pelvis, groin and into the thighs becomes compressed.This can be caused by swelling, trauma, or pressure narrowing these openings and squeezing the nerve.auses of meralgia paresthetica. Meralgia paresthetica is caused by nerve entrapment. The lateral femoral cutaneous nerve running through your pelvis, groin and into the thighs becomes compressed.