Therapeutic progress in well-differentiated/dedifferentiated liposarcoma (WDLPS/DDLPS) is hampered by lack of relevant experimental models, thereby limiting comprehensive molecularly based investigations. Our goal is to bridge this experimental gap by establishing and characterizing an in vitro/in vivo model useful for examining WDLPS/DDLPS molecular pathogenesis and also therapeutic screening and testing. WDLPS/DDLPS cells were isolated from freshly resected human surgical specimens and were phenotypically and molecularly characterized. MDM2 amplification was determined via FISH analysis. Adipogenic differentiation was evaluated using Oil Red O staining and western blotting (WB). Tyrosine kinase receptors' (TKRs) expression in pre-adipocytes, adipocytes, WDLPS, and DDLPS cells was determined via western blot analysis. SCID mouse xenograft growth was assessed after subcutaneous and/or intraperitoneal tumor cell injection. There was enhanced proliferation, migration, invasion, survival, and pro-angiogenic capacity in DDLPS cells vs WDLPS cells. DDLPS cells formed tumors in SCID mice whereas WDLPS did not. WDLPS/DDLPS cells, especially those that exhibited baseline PPARγ expression, partially retained terminal adipogenic differentiation capacity. MDM2 amplification was found in all WDLPS/DDLPS cell strains, CDK4 overexpression was observed in LPS cells as compared with normal adipocytes, and enhanced JUN expression and phosphorylation was seen in DDLPS cells as compared with WDLPS cells. The TKRs: MET, AXL, KIT, and IGF-1R were overexpressed in LPS cells vs normal adipocytes and pre-adipocytes. In conclusion, these newly established cellular and xenograft models can facilitate investigation of liposarcomagenesis, dedifferentiation, and tumor progression. Further studies of the molecular deregulations so identified may lead to improved therapeutic strategies for patients afflicted by these unfavorable malignancies.