Optical molecular imaging is a fast-developing field that holds great promise in cancer diagnosis. Over the past two decades, optical imaging has been actively investigated by researchers in both academic and industrial environments. Compared with other imaging modalities like MRI, CT, and ultrasound (US), optical imaging has many advantages. Technological improvements over the past few years have brought improved tissue penetration, sensitivity, and specificity of imaging cancer by optical methods. Novel devices like diffusion optical tomography (DOT) and the miniature endoscope have either been tested in clinical trials or approved by FDA for clinical use. Many of these new technologies can be integrated into or combined with MRI, CT, or US, providing a multimodality approach to further improve the accuracy of cancer diagnosis. Fast computational methods and ever-growing powerful computers make real-time optical imaging possible, bringing us closer to the possibility of on-site diagnosis. Here we review two different optical imaging methods, namely diffusion optical tomography and microendoscopy. DOT uses near-infrared light to noninvasively measure the hemoglobin concentration and resolve spectroscopic information about the tissue, whereas a tumor may manifest itself as a heterogeneous region due to the increased blood flow to the tumor. Like MRI, CT, and US, DOT sensors interrogate the tissue from the outside. Contrast agents like indocyanine green (ICG) may be used to label the suspected tumor for enhanced DOT results. The microendoscope, however, measures fluorescence signal from inside of the body, typically a cavity like the pulmonary pathway or gastrointestinal tract. The small size of the microendoscope (a few millimeters) allows it to be inserted into small pulmonary branches inaccessible to a conventional endoscope. In addition, microendoscopy offers image resolution approximating that of the microscope, making “in-situ” optical biopsy a possibility.