Posterior fossa dermoid cysts are rare intracranial tumors. Most are congenital and develop during early pregnancy but manifest later in life. We report a case of a congenital posterior fossa dermoid cyst in a 22-year-old patient presenting with fever and multiple neurological complaints. Imaging studies revealed a bony defect in the occipital bone suggestive of sinus formation, heterogeneous hypointensity on T1-weighted image (T1WI), and post-contrast peripheral enhancement suggestive of an infectious process and abscess formation. The histopathological examination was typical for a dermoid cyst containing adnexal structures. This report reviews the case with its unique location and unusual radiological features. Further, the clinical presentation, diagnosis modalities, and treatment outcomes are discussed.