Dorsal dermal sinus is a rare, congenital lesion found most frequently in the lumbosacral followed by the occipital regions. It is rarely localized at the thoracic level. We report a rare case of thoracic congenital dermal sinus (CDS) associated with an intramedullary dermoid cyst in a 2-year-old male child, who presented with a 3 month history of motor weakness of both the lower extremities. Magnetic resonance imaging (MRI) of spine showed an intramedullary dermoid cyst extending from the lower border of T4 to upper border of T7, which was connected with the skin dimple along the sinus tract. Total excision of the dermoid cyst and the sinus tract with T5-7 laminectomy resulted in good functional recovery.