Introduction: Locking of the knee attributed to non-discoid lateral meniscus in an atraumatic setting is a rare phenomenon. One such cause is permanent subluxation of lateral meniscus (PSLM). In the entire literature, there is only one documented case of a 37-year-old female. Case Report: We present a case of a 10-year-old boy who suffered two episodes of knee locking reported radiologically as a bucket handle tear of the lateral meniscus. No tear was found during arthroscopy. The lateral meniscus was malformed with meniscocapsular discontinuity and irreducibly subluxated into the intercondylar space. No salvage procedure was possible. We ended up performing a subtotal meniscectomy. Conclusion: This is the first case of PSLM reported in the pediatric age group and second overall. Management options are limited. Further genetic and fetal studies are needed in this area to determine the exact causality. Keywords: Permanent subluxation of lateral meniscus, lateral meniscus malformation, irreducible non-discoid lateral meniscus, meniscocapsular discontinuity.