Pseudomeningocele resulting from a fracture of the second thoracic vertebra occurred in a six-year-old girl. The condition was diagnosed using computed tomography (CT) and magnetic resonance imaging (MRI). MRI also showed a completely transected spinal cord. Unlike similar lesions reported previously, the pseudomeningocele was managed nonoperatively with observation alone and was seen to gradually resolve over several months. An overview of previously reported cases and indications for surgery is presented. The natural history appears to be spontaneous resolution. Surgery should be performed only for symptoms attributable to the lesion.