Neoadjuvant Letrozole in Treating Postmenopausal Women With Estrogen-Receptor Positive and/or Progesterone-Receptor Positive Stage II, Stage IIIA, or Stage IIIB Breast Cancer

DISEASE CHARACTERISTICS: * Histologically confirmed infiltrating adenocarcinoma of the breast by core needle biopsy * Clinical stage T2-T4a-c, N0-2, M0 * Palpable and measurable disease * Previously untreated disease * Benefits from neoadjuvant therapy that would improve surgical outcome AND meets criteria for 1 of the following: * Marginal candidate for lumpectomy (e.g., lumpectomy feasible but patient at risk for positive margins or poor cosmetic outcome) AND patient desires breast-conserving surgery * Ineligible for lumpectomy due to size of primary tumor, but modified radical mastectomy feasible AND patient desires breast-conserving surgery * Inoperable disease AND systemic therapy required for disease to become operable by modified radical mastectomy * Bilateral primary tumors allowed provided both tumors are consistent with entry criteria * No inflammatory carcinoma (defined as peau d' orange affecting at least one third of the breast) * Direct extension of the tumor to the skin allowed * No metastatic breast disease, except isolated ipsilateral supraclavicular lymphadenopathy * Hormone receptor status: * Estrogen- and/or progesterone-receptor positive disease based on 10% or more nuclear staining of the invasive component of the tumor PATIENT CHARACTERISTICS: Age * Postmenopausal Sex * Female Menopausal status * Postmenopausal, defined as meeting 1 of the following criteria: * Cessation of menstrual periods for at least 1 year * Bilateral surgical oophorectomy * Follicle-stimulating hormone and estradiol levels in the postmenopausal range Performance status * ECOG 0-2 Life expectancy * Not specified Hematopoietic * Not specified Hepatic * No severe liver dysfunction that would preclude study participation Renal * Not specified Other * Willing and able to provide biopsy material * Willing to undergo breast surgery after neoadjuvant treatment * No condition (e.g., confusion, infirmity, or alcoholism) that would preclude study compliance * No other concurrent active and progressive invasive malignancies * No other concurrent severe disease that would preclude study participation PRIOR CONCURRENT THERAPY: Biologic therapy * No concurrent immunotherapy or biological response modifiers for breast cancer Chemotherapy * No prior chemotherapy for breast cancer * No concurrent chemotherapy for breast cancer Endocrine therapy * At least 2 weeks since prior hormone replacement therapy or phytoestrogenic herbal, alternative, or over-the-counter (OTC) sex hormone remedies * No prior hormonal agents for breast cancer * No prior aromatase inhibitors, tamoxifen, raloxifene, or other antiestrogen or selective estrogen receptor modulators * No concurrent drugs known to affect sex hormone status, including hormone replacement therapy or phytoestrogenic herbal, alternative, or OTC remedies * No other concurrent endocrine therapy for breast cancer Radiotherapy * No prior radiotherapy for breast cancer * No concurrent radiotherapy for breast cancer Surgery * Prior sentinel node biopsy allowed * No other concurrent surgery for breast cancer Other * More than 30 days since prior non-approved or experimental drugs * Concurrent bisphosphonates for osteoporosis allowed * No other concurrent treatment for breast cancer