Although conventional mammography is currently the best modality to detect early breast cancer, it is limited in that the recorded image represents the superposition of a 3D object onto a 2D plane. As an alternative, cone-beam CT breast imaging with a CsI based flat-panel imager (CTBI) has been proposed with the ability to provide 3D visualization of breast tissue. To investigate possible improvements in lesion detection accuracy using CTBI over digital mammography (DM), a computer simulation study was conducted using simulated lesions embedded into a structured 3D breast model. The computer simulation realistically modeled x-ray transport through a breast model, as well as the signal and noise propagation through the flat-panel imager. Polyenergetic x-ray spectra of W/Al 50 kVp for CTBI and Mo/Mo 28 kVp for DM were modeled. For the CTBI simulation, the intensity of the x-ray spectra for each projection view was determined so as to provide a total mean glandular dose (MGD) of 4 mGy, which is approximately equivalent to that given in a conventional two-view screening mammography study. Since only one DM view was investigated here, the intensity of the DM x-ray spectra was defined to give 2 mGy MGD. Irregular lesions were simulated by using a stochastic growth algorithm providing lesions with an effective diameter of 5 mm. Breast tissue was simulated by generating an ensemble of backgrounds with a power law spectrum. To evaluate lesion detection accuracy, a receiver operating characteristic (ROC) study was performed with 4 observers reading an ensemble of images for each case. The average area under the ROC curves (Az) was 0.94 for CTBI, and 0.81 for DM. Results indicate that a 5 mm lesion embedded in a structured breast phantom can be detected by CT breast imaging with statistically significant higher confidence than with digital mammography.