As with other epithelial cancers, lung cancer develops over a period of several years or decades via a series of progressive morphological changes accompanied by molecular alterations that commence in histologically normal epithelium. However the development of lung cancer presents certain unique features that complicates this evaluation. Anatomically the respiratory tree may be divided into central and peripheral compartments having different gross and histological anatomies as well as different functions. In addition, there are three major forms of lung cancer and many minor forms. Many of these forms arise predominantly in either the central or peripheral compartments. Squamous cell and small cell carcinomas predominantly arise in the central compartment, while adenocarcinomas predominantly arise peripherally. Large cell carcinomas are not a single entity but consist of poorly differentiated forms of the other types and, possibly, some truly undifferentiated "stem cell like" tumors. The multistage origin of squamous cell carcinomas, because of their central location, can be followed more closely than the peripherally arising adenocarcinomas. Squamous cell carcinomas arise after a series of reactive, metaplastic, premalignant and preinvasive changes. However, long term observations indicate that not all tumors follow a defined histologic course, and the clinical course, especially of early lesions, is difficult to predict. Peripheral adenocarcinomas are believed to arise from precursor lesions known as atypical adenomatous hyperplasias and may have extensive in situ growth before becoming invasive. Small cell carcinomas are believed to arise from severely molecularly damaged epithelium without going through recognizable preneoplastic changes. The molecular changes that occur prior to the onset on invasive cancers are extensive. As documented in this chapter, they encompass all of the six classic Hallmarks of Cancer other than invasion and metastasis, which by definition occur beyond preneoplasia. A study of preinvasive lung cancer has yielded much valuable biologic information that impacts on clinical management.