The hypothalamic hormone oxytocin plays a major role in regulation of behavior and body composition. Quality of survival is frequently impaired in childhood craniopharyngioma patients due to sequelae such as behavioral deficits and severe obesity caused by tumor or treatment-related hypothalamic lesions. In our pilot cross-sectional study, we analyzed emotion recognition abilities and oxytocin concentrations in saliva and urine before and after single nasal administration of 24 IU oxytocin in 10 craniopharyngioma patients. Four craniopharyngioma presented with grade I lesions (limited to anterior hypothalamic areas) and 6 craniopharyngioma with grade II lesions (involving mammillary bodies and posterior hypothalamic areas). Emotional tasks were assessed before and after administration of oxytocin using the Geneva multimodal emotion portrayals corpus and the Multidimensional Mood Questionnaire. All patients presented with detectable levels of oxytocin before administration. Nasal administration of oxytocin was well-tolerated and resulted in increased oxytocin concentrations in saliva and urine. After oxytocin administration, craniopharyngioma patients with postsurgical lesions limited to the anterior hypothalamus area showed improvements in emotional identifications compared to craniopharyngioma patients with lesions of anterior and posterior hypothalamic areas. Focusing on correct assignments to positive and negative emotion categories, craniopharyngioma patients improved assignment to negative emotions. Oxytocin might have positive effects on emotion perception in craniopharyngioma patients with specific lesions of the anterior hypothalamic area. Further studies on larger cohorts are warranted.