We encountered a rare case of pulmonary phaeohyphomycosis due to Xylohypha bantiana documented by culture. This dematiaceous (darkly pigmented) fungus is primarily neurotropic. It usually produces phaeohyphomycosis of the central nervous system but may also involve the skin and subcutaneous tissues. The patient, a 49-year-old woman with a history of steroid-treated inflammatory bowel disease, was found to have a lung nodule consisting of granulomas that contained dark hyphal fragments that stained positively with the argentaffin reaction. Surgical excision was curative and appears to be the treatment of choice.