Clinical features of peripheral non-small cell lung cancer 2.0 cm or less were retrospectively analyzed. Nodal status and prognosis in relation to tumor diameter and histologic type were investigated in 171 consecutive patients with peripheral clinical T1N0M0 non-small cell lung carcinomas 2 cm or less in diameter and who had undergone surgical resection between 1976 and 1997. Of the 171 patients, 136 had adenocarcinoma, 27 had squamous cell carcinoma, four had large cell carcinoma, three had carcinoid and one had adeno-squamous carcinoma. There was no statistically significant difference in the incidence of stage I cases between adenocarcinoma and squamous cell carcinoma. Lymph node involvement was recognized in 30 (17.5%) patients: ten (5.8%) at N1 nodes and 20 (11.7%) at N2 nodes. Lymph node metastasis was significantly more common in tumors 1.5-2.0 cm in diameter (22%) than in those 1.5 cm or less in diameter (14.0%, P = 0.0490). There was no lymph node metastasis in tumors 1.0 cm or less in diameter. The 5-year survival rates cases with or without lymph node involvement were 63.3 and 75.3%, respectively, showing significant difference (P = 0.0338). The result of the present study suggested that systematic mediastinal and hilar lymph node dissection is necessary even for cases with tumor diameter less than 2 cm. However, if the tumor is within 1.0 cm in diameter, mediastinal lymph node dissection might be dispensable; therefore, these cases are good candidates for video-assisted lobectomy.