I know this is scary, but it may very well be benign. Don't worry, take her to your vet to find out what it is for sure. Maddy had a similar lump, and it was a Sebaceous Cyst. I had it removed, and she's fine, never has returned.
From Wikipedia, the free encyclopedia
A sebaceous cyst (a form of trichilemmal cyst) is a closed sac or cyst below the surface of the skin that has a lining that resembles the uppermost part (infundibulum) of a hair follicle and fills with a fatty white, semi-solid material called sebum. Sebum is produced by sebaceous glands of the epidermis.
It is sometimes (but not always) considered to be equivalent to epidermoid cyst, or similar enough to be addressed as a single entity.[1]
Some sources state that a "sebaceous cyst" is defined not by the contents of the cyst (sebum) but by the origin (sebaceous glands). Because an "epidermoid cyst" originates in the epidermis, and a "pilar cyst" originates from hair follicles, neither type of cyst would be considered a sebaceous cyst by this definition.[2] However, in practice, the terms are often used interchangeably.
"True" sebaceous cysts are relatively rare.[3]
The scalp, ears, back, face, and upper arm, are common sites for sebaceous cysts, though they may occur anywhere on the body except the palms of the hands and soles of the feet. In males a common place for them to develop is the scrotum and chest .They are more common in hairier areas, where in cases of long duration they could result in hair loss on the skin surface immediately above the cyst. They are smooth to the touch, vary in size, and are generally round in shape.
They are generally mobile masses that can consist of:
fibrous tissues and fluids
a fatty, (keratinous), substance that resembles cottage cheese, in which case the cyst may be called "keratin cyst"
a somewhat viscous, serosanguineous fluid (containing purulent and bloody material)
The nature of the contents of a sebaceous cyst, and of its surrounding capsule, will be determined by whether the cyst has ever been infected.
With surgery, a cyst can usually be excised in its entirety. Poor surgical technique or previous infection leading to scarring and tethering of the cyst to the surrounding tissue may lead to rupture during excision and removal. A completely removed cyst will not recur, though if the patient has a predisposition to cyst formation, further cysts may develop in the same general area.