Malignant transformation of ovarian endometriosis was first described in 1925 by Sampson; later on it has been described in extragonadal regions by few authors also. Ovarian endometrioid and clear cell carcinoma are highly associated with endometriosis. Here we present a case of malignant transformation of ovarian endometrioma into endometrioid adenocarcinoma and review the clinical and pathological features of these tumors. A 45-years old infertile woman diagnosed as a case of bilateral chocolate cyst with pelvic endometriosis underwent total hysterectomy with bilateral salpingo-oophorectomy. A solid portion was also identified in the right sided cyst, histology of which revealed a well-differentiated endometrioid adenocarcinoma grade-II with foci of squamous morules and keratin pearls. Her pre-operative CA-125 level was within normal range. Women with endometriosis should be considered at an increased risk for the development of ovarian cancer even with normal CA-125 level.