Laser optoacoustic imaging can be applied for characterization of layered and heterogeneous tissue structures in vivo. Accurate tissue characterization may provide: (1) means for medical diagnoses, and (2) pretreatment tissue properties important for therapeutic laser procedures. Axial resolution of the optoacoustic imaging is higher than that of optical imaging. However, the resolution may degrade due to either attenuation of high-frequency ultrasonic waves in tissue, or/and diffraction of low-frequency acoustic waves. The goal of this study was to determine the axial resolution as a function of acoustic attenuation and diffraction upon propagation of laser-induced pressure waves in water with absorbing layer, in breast phantoms, and in biological tissues. Acoustic pressure measurements were performed in absolute values using piezoelectric transducers. A layer or a small sphere of absorbing medium was placed within a medium with lower optical absorption. The distance between the acoustic transducer and the absorbing object was varied, so that the effects of acoustic attenuation and diffraction could be observed. The location of layers or spheres was measured from recorded optoacoustic pressure profiles and compared with real values measured with a micrometer. The experimental results were analyzed using theoretical models for spherical and planar acoustic waves. Our studies demonstrated that despite strong acoustic attenuation of high-frequency ultrasonic waves, the axial resolution of laser optoacoustic imaging may be as high as 20 micrometers for tissue layers located at a 5-mm depth. An axial resolution of 10 micrometers to 20 micrometers was demonstrated for an absorbing layer at a distance of 5 cm in water, when the resolution is affected only by diffraction. Acoustic transducers employed in optoacoustic imaging can have either high sensitivity or fast temporal response. Therefore, a high resolution may not be achieved with sensitive transducers utilized in breast imaging. For the laser optoacoustic imaging in breast phantoms, the axial resolution was better than 0.5 mm.