Laser treatment is considered to be effective in treating carcinoma in situ of the penis. We, however, report a case with carcinoma in situ of the penis which developed invasive carcinoma and inguinal lymphnode metastases only 6 months after the laser treatment. A 74-year-old man with pseudophimosis presented with redness of the glans penis. A physical examination revealed thick erythema, 12 millimeters in diameter, around the external urethral meatus. Histologically, biopsy revealed squamous cell carcinoma in situ. No metastasis was suspected by physical examination and imaging studies. Although the lesion appeared to slightly extend into the urethra, it was primarily treated with the CO2 laser. Six months after the treatment, however, local recurrence was confirmed by the touch smear cytology, resulting in the partial amputation of the penis. The histopathological examination revealed subepithelial and marked lymphatic invasion of the tumor and positive margin in the urethral stump (squamous cell carcinoma in situ). Further, since bilateral superficial inguinal lymphnode swelling appeared, total amputation of the penis with perineal urethrotomy and pelvic/inguinal lymphnode dissection was performed subsequently. The metastases to bilateral inguinal lymphnodes were confirmed histologically. The patient received adjuvant chemotherapy and has been alive and well without evidence of disease 40 months after the initial treatment.