Within the squamate clade Anguimorpha, Xenosaurus is an enigmatic taxon combining several apparently primitive features with a highly specialized set of autapomorphies. This combination makes the fossil record along the Xenosaurus stem particularly important for resolving the relationships of Xenosaurus with other anguimorphs, and between species of Xenosaurus. Exostinus serratus Cope, 1873 from the Oligocene of the western United States is currently hypothesized to be the immediate sister taxon to Xenosaurus. The cranial osteology of this pivotal taxon is described here for the first time from all known material, using high-resolution X-ray computerized tomography (CT) scanning to visualize individual elements. Exostinus serratus displays a mosaic of ancestral anguimorph features that are transformed in Xenosaurus, as well as unique synapomorphies shared with Xenosaurus. The region of the external nares is less transformed than in Xenosaurus, as are the general proportions of the bones surrounding the cartilaginous nasal capsule. However, the forms of the teeth and of the osteodermal sculpture, as well as several details of maxillary and mandibular morphology, are distinctly Xenosaurus-like. Several autapomorphies are also present, including an abbreviated tooth row and an unusually wide palatal shelf of the maxilla. An understanding of the ways in which the non-ossified tissues of the head influenced the development of the bones is crucial to interpreting their morphology. Furthermore, subtle anatomical features often provide important comparative information, and are emphasized herein.