In this report, we describe a 54-year-old male with cystic retroperitoneal sarcoma extending through the inguinal canal. Patient initially underwent inguinal hernia repair with mesh placement for suspected cord lipoma, after which he developed recurrent loculated retroperitoneal fluid collections refractory to multiple attempts at drain placement and laparotomy. Twenty-nine months after initial surgery, patient was referred to our institution on suspicion of malignancy. Pathology of resections taken during subsequent laparotomy showed foci of malignant cells interspersed throughout reactive proliferations. Follow-up immunohistochemistry confirmed high-grade sarcoma, likely atypical liposarcoma, but was unable to definitively establish subtype. Despite en bloc resection and gemcitabine/docetaxel chemotherapy, local progression continued, and patient was enrolled in clinical trials of doxorubicin with dual immune checkpoint blockade. This case suggests that sarcoma should be considered as a differential diagnosis of retroperitoneal or inguinal mass unresponsive to treatment; and highlights the difficulty of subtyping and managing cystic retroperitoneal sarcoma.