First clinical prototype laser optoacoustic imaging system (LOIS) for breast cancer detection was designed and fabricated using a compact Nd:YAG laser, fiberoptic light delivery system, a linear array of 12 wide-band acoustic transducers, and a data acquisition card operated by computer with original signal processing and image reconstruction code. Initially images of small absorbing spheres were recorded in the milk with optical properties resembling those of the breast at the wavelength of 1064-nm. The system was optimized for contrast, sensitivity and axial (in-depth) resolution. The small number of acoustic transducers (12), which in turn was determined by the system cost and the time of image acquisition limited the lateral resolution of the images. Clinical ex-vivo studies on radical mastectomy specimens were performed and compared with x-ray radiography, MRI and ultrasound imaging. The results of our pilot clinical studies showed pronounced opto-acoustic contrast of ~300% between breast tumors and normal breast tissues. This contrast substantially exceeds any other endogenous tissue contrast currently utilized in clinical ultrasonography, MRI and x-ray mammography. Based on literature data and our gross observations of tumor cross-sections we hypothesize that the opto-acoustic contrast results primarily from increased optical absorption in the dense microvascularity of the tumors. In patients receiving radiotherapy, tumors were found to contain enhances concentration of dense highly scattering fiberotic tissue.