Hydatic cysts rising from the pancreas are very rarely encountered. Such cysts may often perplex the clinician because they cause symptoms and signs simulating various diseases of this region. Obstructive jaundice due to extrinsic compression of the distal common duct by a hydatic cyst located in the head of pancreas, was found in a 60 year old man. Successful surgical treatment consisted of transduodenal cystoduodenostomy and choledochoduodenostomy. Diagnosis and treatment options for pancreatic hydatic cysts are discussed.