Peritumoral cysts (those arising immediately adjacent to the tumor mass) are frequently associated with benign and malignant tumors of the brain and spinal cord (syringomyelia). The cystic component of central nervous system (CNS) tumors and associated peritumoral cysts are often the cause of clinical symptoms. Because of the common occurrence of peritumoral cysts with CNS neoplasms and the morbidity associated with them, advanced imaging, histological, and molecular techniques have been used to determine the mechanism underlying cyst formation and propagation. Based on evidence from such studies, edema appears to be a common precursor to peritumoral cyst formation in the CNS. Mediators of vascular permeability acting locally in the tumor and/or hydrodynamic forces within abnormal tumor vasculature appear to drive fluid extravasation. When these forces overcome the ability of surrounding tissue to resorb fluid, edema and subsequent cyst formation occur. These findings support the concept that the tumor itself is the source of the edema that precedes cyst formation and that resection of tumors or medical therapies directed at decreasing their vascular permeability will result in the resolution of edema and cysts.