Lipoblastomas are rare soft tissue tumors that occur primarily in young children. They typically contain variably differentiated adipocytes, primitive mesenchymal cells, myxoid matrix, and fibrous trabeculae. Abnormalities in chromosome 8, leading to rearrangements of the PLAG1 gene, were demonstrated recently in four lipoblastomas. In the present report, we determine the frequency of PLAG1 alterations in 16 lipoblastomas from children aged 13 years or younger, and we also evaluate the stages of lipoblastoma differentiation at which PLAG1 genomic alterations are found. Eleven lipoblastomas (69%), including those with either classic or lipoma-like histology, had rearrangements of the 8q12 PLAG1 region. Another three lipoblastomas had polysomy for chromosome 8 in the absence of PLAG1 rearrangement. Only two cases (13%) lacked a chromosome 8 abnormality. Notably, the lipoblastomas with chromosome 8 polysomy had up to five copies of chromosome 8 as an isolated cytogenetic finding in an otherwise diploid cell. We also demonstrate that PLAG1 alterations are found in a spectrum of mesenchymal cell types in lipoblastomas, including lipoblasts, mature adipocytes, primitive mesenchymal cells, and fibroblast-like cells. This finding is consistent with neoplastic origin in a primitive mesenchymal precursor and with variable differentiation to a mature adipocyte end-point. Hence, our studies provide biological validation for the clinical observation that lipoblastomas can evolve into mature, lipoma-like, lesions. They also suggest that PLAG1 dosage alterations caused by polysomy 8 might represent an alternative oncogenic mechanism in lipoblastoma.