Pigmented villonodular synovitis (PVNS) is a benign neoplastic process affecting the synovium. Magnetic resonance imaging (MRI) is considered as the imaging modality of choice, where PVNS is seen as a soft tissue lesion affecting the synovium with characteristic hypointense signal on T2-weighted images (T2WI) and typically blooming on gradient echo (GRE) sequences. MRI can sometimes be misleading, with many non-neoplastic pathologies having a tendency of recurrent bleeding closely mimicking PVNS. We report a case of pseudoaneurysm from posterior circumflex humeral artery, a branch of axillary artery, secondary to recurrent shoulder dislocation mimicking PVNS on MRI.