To avoid contamination of equipment and reduce risks of infection, intraoperative cytology (IOC) is a useful substitute to conventional frozen section in the diagnosis of infectious diseases. One of the various histomorphologic patterns of infections is the granuloma, which sometimes may be difficult to diagnose cytologically. In an attempt to assess accuracy and pitfalls of IOC in the diagnosis of granuloma, cases diagnosed as granuloma on IOC or on permanent sections (PS) at George Washington University Medical Center were collected for the period of September 1990 to March 1996. Cyto- histologic correlation was performed. During that time, a diagnosis of granuloma in either the IOC or PS was rendered in 156 of 5,901 IOC cases. IOC showed definite granuloma (87), suspicious for granuloma (23), and neither definite nor suspicious for granuloma in 46 cases. The latter group corresponded to neoplasms (5) and benign conditions (41). Eighty-five cases were accurately diagnosed as definite granuloma by both IOC and PS. Fifty- seven cases diagnosed as granuloma by PS corresponded on IOC to suspicious for granuloma (11), benign smear (41), and neoplasms (5). Only two cases were incorrectly diagnosed as granuloma on IOC: a neoplasm and a case of fibrosis. Overall, four cases of neoplasms were interpreted as suspicious for granuloma (3) or definite granuloma (1) on IOC, and five cases of granulomas were misdiagnosed as neoplasms on IOC. Four of these nine case were deferred for a PS diagnosis. IOC is a useful tool in the diagnosis of granulomas with a sensitivity of 60% and specificity of 99% and positive and negative predictive values of 98% and 99%, respectively. Rarely, neoplasms may be misdiagnosed as granulomas and vice versa.