Dedifferentiated liposarcoma represents a form of liposarcoma composed of a non-lipogenic sarcoma associated with well-differentiated liposarcoma. The prognostic significance of histological grading of the dedifferentiated component remains to be elucidated due to vague grading criteria employed in previous studies. Molecular markers of tumor behavior, including amplification levels of murine double minute-2 (MDM2) and cyclin-dependent kinase-4 (CDK4) genes, have been explored in a limited number of cases. Here we investigate whether 'Fédération Nationale des Centres de Lutte Contre le Cancer' (FNCLCC) grade and MDM2 gene amplification levels have prognostic value in dedifferentiated liposarcoma in terms of local recurrence and disease-specific survival. Fifty cases were retrieved, reviewed and FNCLCC grade was scored for the dedifferentiated component. Testing for MDM2 gene amplification was performed by fluorescence in situ hybridization. Amplification was categorized as high level (≥20 copies) and as low level (<20 copies). Follow-up data was obtained through chart review. Log-rank test and Cox proportional hazard models were used to determine the effect of grade and level of MDM2 amplification on outcomes. Our series includes 50 patients (male n=28, female n=22) with an average age of 63 years (range, 28-88) and a median follow-up of 28 months (range, 2-120). Tumors were graded as grade 1 (6%), grade 2 (58%), and grade 3 (36%). When adjusted for age, sex, site, tumor size, and margin status, grade 3 patients had a higher recurrence rate than grades 1 and 2 (HR=2.07, 95% CI: 1.24, 7.62; P=0.015). Patients with high-level MDM2 amplification had higher recurrence rate on univariate analysis (P=0.028), but not on multivariate analysis (HR=1.69, 95% CI: 0.73, 3.94; P=0.221). FNCLCC grade 3 dedifferentiation confers a worse prognosis in dedifferentiated liposarcoma in terms of local recurrence. MDM2 amplification level remains a useful diagnostic tool in dedifferentiated liposarcoma, but has no prognostic value in terms of local recurrence.