The disease kills more than 35,000 annually in the UK, and has a low survival rate because diagnosis is often at the terminal stage.
Dr Mike Davies from the University of Liverpool Roy Castle Lung Cancer Research Programme, said: "These findings tell us that it's theoretically possible to develop a test that could diagnose early lung cancer in the breath of patients.
"There's an urgent need to diagnose lung cancers earlier, when treatment is more effective.
"This is a potential step towards developing a handheld device that could aid lung cancer screening and diagnosis. It could also be used to help match patients to the right treatment by providing doctors with a snapshot of the genetic make-up of their individual tumour."
He said tests would be carried out on cancer patients to see whether the method can accurately diagnose genetic changes in growing lung tumours.
Nell Barrie, senior science information manager at Cancer Research UK, said: "These early results raise the prospect of a cheap, effective test to diagnose lung cancer. But we're still a way off from the large-scale trials necessary before this technique could be used widely.
"Lung cancer is extremely difficult to treat, but when diagnosed at its earliest stage around 70 per cent of patients will survive their disease for a year or more, compared with 14 per cent when the disease is diagnosed at its most advanced stage.
"So any test that could potentially diagnose the disease earlier would be good news for patients. In the meantime, anyone with a persistent cough, shortness of breath or blood in their phlegm should see their GP as soon as possible."
The research is published in the British Journal of Cancer.
- AAP