Pigmented epithelioid melanocytoma (PEM) is a tumor encompassing epithelioid blue nevus of Carney complex (EBN of CNC) and was previously termed animal-type melanoma. Histologically PEMs are heavily pigmented spindled and epithelioid dermal melanocytic tumors with infiltrative borders, however, their origin remains unclear. Stem cells for the epidermis and hair follicle are located in the bulge area of the hair follicle with the potential to differentiate into multiple lineages. Multiple cutaneous carcinomas, including follicular cutaneous squamous cell carcinoma (FSCC), are thought to arise from stem cells in the follicular bulge. We present two cases of PEM/ATM in a 63 year-old male on the scalp with follicular origin and a 72 year-old female on the upper back arising in an intradermal nevus. Biopsy of both cases revealed a proliferation of heavily pigmented dermal nests of melanocytes with atypia. The Case 1 tumor was in continuation with the outer root sheath of the hair follicle in the bulge region. Case 2 arose in an intradermal melanocytic nevus. Rare mitotic figures, including atypical mitotic figures, were identified in both cases. We present two cases of PEM, with histologic evidence suggesting two origins: one from the follicular bulb and one from an intradermal nevus.