Summary We describe a squamous cell carcinoma arising from a psoriatic nail bed. The tumour had a verrucous surface and was very well differentiated, raising the possibility of early verrucous carcinoma. Occurrence of any type of squamous carcinoma in this site and background is extremely rare. Particular diagnostic and therapeutic questions arise in this unusual setting. We discuss the aetiology and diagnostic differentiation from other nail bed squamoproliferative lesions, particularly so-called subungual keratoacanthoma. We also discuss therapeutic options, including Moh's surgery and retinoids.