The cause is usually a developmental abnormality arising in the early prenatal period, typically failure of obliteration of the second, third, and fourth branchial cleft, i.e. failure of fusion of the second branchial arches and epicardial ridge in lower part of the neck.

[3][4] The cyst wall is composed of squamous epithelium (90%), columnar cells with or without cilia, or a mixture of both, with lymphoid infiltrate, often with prominent germinal centers and few subcapsular lymph sinuses.

The cyst is typically surrounded by lymphoid tissue that has attenuated or absent overlying epithelium due to inflammatory changes.

[7] Four branchial clefts (also called "grooves") form during the development of a human embryo.

Often, the tracts of the cyst will pass near important structures, such as the internal jugular vein, carotid artery, or facial nerve, making complete excision impractical due to the high risk of complications.