The tumor consists of basophilic epithelium with peripheral palisading. Mitotic activity is usually minimal. The slits between tumorous nests and the stroma, but rather between the stroma and uninvolved dermis. Focal differentiation into hair bulbs with stromal reaction (and differentiation into the papilla). The tumor doesn's usually reach depper than into 2/3 of the dermis (this differs from trichoblastoma).