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The parameters of the Nakagami distribution have been utilized in the past to classify lesions in breast tissue as benign or malignant. To avoid the effect of operator-gain settings on the parameters of the Nakagami distribution, normalized parameters were utilized for the classification. The normalized parameter was defined as the ratio of the parameter at the site of the lesion to its average value over several regions away from the site. This technique, however, was very time consuming. In this paper, the application of frequency diversity and compounding is explored to achieve this normalization. Lesions are classified using these normalized parameters at the site. A receiver operating characteristic (ROC) analysis of the parameters of the Nakagami distribution has been conducted before and after compounding on a data set of 60 benign and 65 malignant lesions. The ROC results indicate that this technique can reasonably classify lesions in breast tissue as benign or malignant.