An arachnoid cyst causing a compressive oculomotor nerve palsy is rare in the pediatric population. We describe a case of an acquired, partial oculomotor nerve palsy in a 3-year-old boy caused by an arachnoid cyst in the left crural cistern with associated amblyopia. The patient's amblyopia was aggressively treated, and he underwent cyst fenestration. Two months postoperatively, he continued to demonstrate a partial oculomotor palsy with improved visual acuity and recurrence of the cyst. This case demonstrates that cyst fenestration may not always resolve these paretic effects, cysts may recur after fenestration, and amblyopia must be treated in this setting.