Enchondroma is the most common primary benign bone tumor of the hand, especially the phalanges, whereas chondrosarcoma is uncommon at this site. Although phalangeal chondrosarcoma may have ominous histologic features, its biologic behavior is relatively indolent. Thirty-five cases of phalangeal lesions previously diagnosed as chondrosarcoma were studied. Histologic and tumor-biologic parameters (Ki-67 and p53 immunohistochemistry) were investigated and correlated with clinical behavior. All cases were characterized by unequivocal malignant histologic features (Grade 2 or higher) or Grade 1 malignant histologic features combined with the presence of cortical destruction and soft tissue extension. The median age of the patients at the time of diagnosis was 67 years (range 21-87 years), with a slight female predominance. Occurrence in the hand was more common than in the foot, with the proximal phalanx affected most often. Treatment varied from local therapy (curettage or local excision) in 16 patients to amputation or exarticulation in 19 cases. Follow-up ranged from 8-432 months for 28 patients. Ten of 15 tumors treated by local therapy recurred whereas none of 13 tumors treated by radical surgery recurred. The median survival was 20.8 years; none of 28 patients developed metastases nor died of disease. Both the type of treatment and localization in the proximal phalanx were associated independently with local recurrence. Phalangeal chondrosarcoma behaves as a locally aggressive lesion and, in contrast to chondrosarcomas located elsewhere, rarely metastasizes. Treatment is indicated only because of its locally destructive growth. The authors believe that given the excellent survival data, curettage with adequate follow-up should be considered as the treatment of choice if technically feasible, especially in those cases in which amputation would lead to a significant loss of hand function.