Necrobiotic xanthogranuloma with paraproteinemia is a clinical and histopathological entity characterized by xanthelasma-like lesions in the periorbital region and elsewhere, paraproteinemia, leukopenia, and an elevated erythrocyte sedimentation rate. Multiple myeloma has been reported as an accompanying feature in several cases. We examined a patient with necrobiotic xanthogranuloma and multiple myeloma in whom an IgG kappa monoclonal protein was identified in serum, urine, bone marrow, and bilateral periorbital lesions. We speculate that increased serum immunoglobulins complexed with lipid may be deposited in the skin, leading to a foreign body giant cell reaction and the subsequent characteristic histopathologic features of necrobiotic xanthogranuloma.