Few studies have compared primary neoadjuvant endocrine therapy with neoadjuvant chemotherapy in breast cancer patients. The need for preoperative chemotherapy with doxorubicin or taxanes may be reduced in postmenopausal patients with estrogen receptor (ER)-positive and/or progesterone receptor (PgR)-positive tumors. This randomized, controlled, phase 2 study evaluated the efficacy of neoadjuvant chemotherapy compared with endocrine treatment with aromatase inhibitors in postmenopausal women with ER-positive and/or PgR-positive breast cancer. Eligible patients were randomly assigned to receive neoadjuvant anastrozole 1 mg/day (n = 61) or exemestane 25 mg/day (n = 60) for 3 months or doxorubicin 60 mg/m(2) with paclitaxel 200 mg/m(2) (four 3-week cycles). Study end points included overall objective response determined by palpation, mammography, and ultrasound, and the number of patients who qualified for breast-conserving surgery and radiotherapy. Clinical objective response was 64% in the endocrine therapy and chemotherapy treatment groups. Median time to clinical response was 57 and 51 days with aromatase inhibitors and chemotherapy, respectively (P > .05). Rates of pathological complete response (3% vs 6%) and disease progression (9% vs 9%) did not differ significantly in the endocrine therapy or chemotherapy group, respectively (P > .05). Rates of breast-conserving surgery were slightly higher in the endocrine group (33% vs 24%; P = .058). The most frequent toxicities from chemotherapy were alopecia (79%), grade 3/4 neutropenia (33%), and grade 2 neuropathy (30%). Endocrine treatment was well tolerated. No deaths occurred during the preoperative treatment. Preoperative neoadjuvant endocrine therapy with aromatase inhibitors was well tolerated and resulted in rates similar to chemotherapy in overall objective response and breast-conserving surgery in postmenopausal women with ER-positive and/or PgR-positive tumors.