We report on the use of diffuse optical spectroscopy analysis of breast spectra acquired in the wavelength range from 500 to 1600 nm with a fiber optic probe. A total of 102 ex vivo samples of five different breast tissue types, namely adipose, glandular, fibroadenoma, invasive carcinoma, and ductal carcinoma in situ from 52 patients were measured. A model deriving from the diffusion theory was applied to the measured spectra in order to extract clinically relevant parameters such as blood, water, lipid, and collagen volume fractions, β-carotene concentration, average vessels radius, reduced scattering amplitude, Mie slope, and Mie-to-total scattering fraction. Based on a classification and regression tree algorithm applied to the derived parameters, a sensitivity-specificity of 98%–99%, 84%–95%, 81%–98%, 91%–95%, and 83%–99% were obtained for discrimination of adipose, glandular, fibroadenoma, invasive carcinoma, and ductal carcinoma in situ, respectively; and a multiple classes overall diagnostic performance of 94%. Sensitivity-specificity values obtained for discriminating malignant from nonmalignant tissue were compared to existing reported studies by applying the different classification methods that were used in each of these studies. Furthermore, in these reported studies, either lipid or β-carotene was considered as adipose tissue precursors. We estimate both chromophore concentrations and demonstrate that lipid is a better discriminator for adipose tissue than β-carotene.