Cytophagic histiocytic panniculitis (CHP) is a rare panniculitis in childhood, associated either with nonmalignant conditions or with subcutaneous panniculitis-like T-cell lymphoma (SPTCL), and often also associated with macrophage activation syndrome (MAS). Discriminating between these 2 conditions is therapeutically important because nonmalignant CHP often improves under cyclosporine and prednisone, whereas most cases of SPLT may be best treated with more aggressive therapy. We report the cases of a 6-month-old boy and a 16-month-old girl who, after viral infection, developed multiple infiltrating skin nodules on the limbs and face, associated with MAS. Histopathologic findings for skin biopsy specimens revealed CHP associated with heavily cellular lobular panniculitis. Hemophagocytosis and immunohistochemical staining features were consistent with typical characteristics of in situ MAS in adipose tissue: the lymphocytes were mostly TCD8+ cells with an activated phenotype (human leukocyte antigen (HLA) -DR+) and expressed interferon-γ; CD68+ macrophages expressed tumor necrosis factor-α and interleukin-6. A monoclonal rearrangement of the T-cell receptor γ gene was present in skin tissue but not in peripheral blood or bone marrow lymphocytes. Cyclosporine A treatment resulted in the complete remission of cutaneous and systemic manifestations in both patients for 66 and 29 months, respectively. This report suggests that the diagnosis of a reactive T-cell lymphoproliferation should be the treatment of choice in young children with severe CHP, even if there is a SPTCL-like aspect with an in situ T-cell clonality. It also suggests that CSA is the optimal treatment of this condition and postulates the possible pathologic process underlying this efficacy.