Malignant transformation in mature cystic teratoma occurs very rarely (2%), its incidence increases with age reaching the highest level in postmenopausal period. A case of squamous cell carcinoma arising from mature cystic teratoma in a 28-year-old woman, one of the few youngest cases reported, and her treatment with fertility sparing surgery is presented. Young age is not a guard from malign transformation arising from mature cystic teratoma; therefore clinician must be aware of this risk. Intraoperative frozen section examination may be beneficial to guide the extent of surgery. Fertility sparing surgery may be preferred in young patients with fertility desire.