So, there's a lump under your scrotal or penile skin? It's red, painful, might ooze something or other, and is clearly not an everyday pimple? Some folks would immediately suspect a sexually transmitted disease — but not you. If you're reading this, you probably suspect you are dealing with a sebaceous cyst. (That doesn't mean you shouldn't still get tested for STDs if there's any chance you could have any!)
A Closer Look: What Are Sebaceous Cysts?
Nope, this isn't one of those instances in which you have to scroll through paragraph upon paragraph of information about what the thing you think you have actually is, even though you already know. You may want to pay attention, because this is quite interesting.
Different kinds of cutaneous cysts will give you really similar symptoms, namely:
- A lump under the skin.
- Redness over and around that lump.
- A sore feeling, especially when you put any kind of pressure on the lump. (Though sebaceous cysts may also be painless.)
- The skin around the cyst may be warm to the touch. 
Search "sebaceous cyst", and you may end up with information about epidermoid cysts and Pilar cysts as well as information about true sebaceous cysts, which are much rarer.
Cysts, in general, are sacs of tissue filled with a liquid or other substance. For your information:
- Sebaceous cysts arise from hair follicles. The sebaceous glands, which secrete an oily, waxy substance called sebum are branched off these follicles.
- Pilar cysts have sacs made from the kind of cells you find in the root of your hairs. They usually develop on the scalp.
- Epidermoid cysts, also called epidermal cysts, are lined with the same kind of cells you find in your epidermis, the outer layer of your skin. 
The fact is that neither you nor your doctor will be able to tell precisely what kind of cyst you are dealing with unless and until the cyst is examined in a lab. Because cysts very rarely but occasionally become malignant, some studies argue that it is essential for every excised cyst to be examined more closely, especially in the case of very large cysts. 
Could That Lump Around My Genitals Be A Sebaceous Cyst?
Yes, that lump on your penile or scrotal skin, or that lump in the pubic area, may be a cyst. Though sebaceous cysts generally appear on the face, neck, or upper torso, they may appear anywhere on the body where you have skin, with the exception of the palms of the hands and the soles of the feet. These cysts are typically fairly small in size (between one and four centimeters in diameter), those over five centimeters in diameter are referred to as giant sebaceous cysts. 
It is, however, more likely that a cyst of the genital skin is a "sebaceous cyst" rather than a true sebaceous cyst — an epidermal cyst, in other words. Such cysts are not at all uncommon on the scrotum, where a multitude of them may develop at once to create a positively frightening look. Since epidermal cysts, in general, tend to appear in hairy areas of the body, it is really no surprise that the scrotum can be affected as well. 
Epidermoid cysts on the shaft of the penis itself are much rarer . Rather than developing spontaneously, they're much more likely to occur as the result of an injury or surgery. In the case of children, penile epidermal cysts are often congenital — meaning the child is born with the cyst — and due to irregular embryonic development. 
Epidermal cysts are pretty common and do not always require medical treatment, but it is particularly easy to end up with a misdiagnosis if you're the one making the diagnosis, as a medically untrained individual. It is simply better to refer genital lesions to your doctor, not just because you want to know what you are dealing with for sure, but also because you may benefit from treatment and because you want to have cancer ruled out. 
Treatment For Sebaceous Cysts On The Scrotum And Penis
If you do have an epidermal or sebaceous cyst on your penile shaft or on your scrotum, it is possible to have the sebaceous cyst removed by draining it via a small excision. Draining the cyst will not, however, remove the sac — and that means you have a high risk of recurrence. A complete excision of the whole sac and the nasty stuff inside is, therefore, the gold standard in epidermal cyst treatment. This kind of surgery is minimally-invasive, can be carried out under local anesthesia, and almost guarantees the cyst will not come back.