Acute lipoid pneumonia is quite uncommon and is associated with oily or lipid contents within the alveoli. Exogenous lipoid pneumonia due to kerosene poisoning, manifests with a wide clinical spectrum ranging from subtle chemical pneumonitis to marked severe pulmonary and systemic inflammation. We present an interesting case of an adult male with kerosene poisoning. He manifested with severe cavitating lung disease. In addition, he developed spontaneous pneumothorax. Both cavitating lung disease and pneumothorax are unusual manifestations of acute exogenous lipoid pneumonia and perhaps follow severe lung injury following high volume kerosene exposure.