INTRODUCTION: Lipomas are benign tumors which may appear in almost any human organ. Their diagnosis rate in the hand region is not known.CASE PRESENTATION: We present the case of a 63-year-old Greek Caucasian woman with a giant lipoma of the hand and palm which was not initially diagnosed. After repeated surgical decompression of the carpal tunnel the patient was referred with persisting symptoms of median and ulnar nerve compression and a prominent mass of her left palm and thenar eminence. Clinical examination, magnetic resonance imaging, nerve conduction study and biopsy, revealed a giant lipoma in the deep palmar space (8.0 × 4.0 × 3.75 cm), which was also infiltrating the carpal tunnel. She had already undergone two operations for carpal tunnel syndrome with no relief of her symptoms and she also ended up with a severed flexor pollicis longus tendon. Definitive treatment was performed by marginal resection of the lipoma and restoration of the flexor pollicis longus with an intercalated graft harvested from the palmaris longus. Thirty months after surgery the patient had a fully functional hand without any neurological deficit.CONCLUSION: Not all lipomas of the wrist and hand are diagnosed. Our report tries to emphasize the hidden danger of lipomas in cases with carpal tunnel symptoms. The need for a high index of suspicion in conjunction with good clinical evaluation and the use of appropriate investigative studies is mandatory in order to avoid unnecessary operations and complications. Marginal excision of these tumors is restorative.