A gamma-ray imaging system has been developed for acquiring stereo images of the distribution of radiopharmaceuticals in breast tissue. The system consists of a small field-of-view gamma-ray camera mounted to a stereotactic biopsy table. The camera is mounted on a rotational arm such that it can be used to image the breast from two 15° stereo views. These stereo images can be used to determine the three dimensional spatial location of a region of focal uptake. Once the location of this region is determined, this information can be used as a guide for stereotactic core needle biopsy. The accuracy that the spatial location of a source could be determined was investigated by moving a point source within the field of view. Measurements indicate that the source could be localized to within 1 mm. A center-of gravity calculation was used to localize the centroid of the image of the source and this was used to determine the spatial location. A comparison of the operation of the gamma imaging system and an X-ray imaging system has been done using a dual modality phantom. These measurements indicate that the spatial location of an isolated source can be determined by the gamma imaging system to within approximately the same accuracy as the X-ray system. Collimators were tested to determine the spatial resolution in the transverse dimension and the impact of this transverse resolution on the axial resolution was investigated. The performance of this gamma-guided stereotactic biopsy system will be presented.