Epidermoid cyst of the cerebellopontine angle is in the main differential diagnosis of an arachnoid cyst. Both of them are low density on CT scan, low signal on T1, and high signal on T2 weighted images and never enhances.  On Flair sequence, the arachnoid cyst demonstrates a similar signal to CSF, whereas epidermoid may have high or low signal intensity. But on DWI images, the epidermoid cyst appears bright however arachnoid cyst is not bright.