Intraosseous neurilemmoma(Schwannoma) is an extremely rare benign neoplasm. The site most commonly involved is the mandible. This occurrence is understandable because of the length of the inferior alveolar canal through the mandible. No other bone contains a canal that transmits a neurovascular bundle of such size and length. We report on a peripheral and central neurilemmoma along pathway of inferior alveolar nerve of the lower lip and mandible in a 28-year old man. A panoramic radiograph of the mandible showed a well-defined bilocular lesion with a thin uniform sclerotic margin located in the ramus and body of the mandible. The CT scan confirmed a well-defined lesion with thinning of the cortex of the body of the left side of the mandible. Histologically, the lesion was a cellular neoplasm with distinct palisading and numerous Verocay bodies. Complete excision was achieved by removing the tumor with the inferior alveolar nerve.