Lipoblastomas are rare, rapidly growing benign tumors rising from embryonic white fatty cells that continue to proliferate in the postnatal period. We presented a case of a toddler with an undifferentiated myxoid neoplasm with features of a minimally differentiated lipoblastoma. Our patient was an 18-month-old female with a painless solid tumefaction in the middle third of the right leg. Histopathologically, the nodular tumor mass consisted of lipobastic cells embedded in a myxoid stroma. Immunohistochemistry showed strong diffuse positivity for vimentin, S100, CD34, CD56, NSE and rare Ki67+ cells. FOXO1 polyploidy was detected in 30% of cells by FISH. Using target RNA sequencing, we detected a fusion gene, CHCHD7-PLAG1, in the tumor sample. Sequence analysis showed that the first exons of CHCHD7 were fused to either exon 2 or exon 3 of PLAG1. Our case demonstrates that due to the histomorphologic overlaps, the molecular diagnostics is essential for confirmation of lipoblastomas.