PURPOSE: To facilitate localization and resection of small lung nodules, we developed a prospective clinical trial (ClinicalTrials.gov number NCT01847209) for a novel surgical approach which combines placement of fiducials using intra-operative C-arm computed tomography (CT) guidance with standard thoracoscopic resection technique using image-guided video-assisted thoracoscopic surgery (iVATS). METHODS: Pretrial training was performed in a porcine model using C-arm CT and needle guidance software. Methodology and workflow for iVATS was developed, and a multi-modality team was trained. A prospective phase I-II clinical trial was initiated with the goal of recruiting eligible patients with small peripheral pulmonary nodules. Intra-operative C-arm CT scan was utilized for guidance of percutaneous marking with two T-bars (Kimberly-Clark, Roswell, GA) followed by VATS resection of the tumor. RESULTS: Twenty-five patients were enrolled; 23 underwent iVATS, one withdrew, and one lesion resolved. Size of lesions were: 0.6-1.8 cm, mean = 1.3 ± 0.38 cm.. All 23 patients underwent complete resection of their lesions. CT imaging of the resected specimens confirmed the removal of the T-bars and the nodule. Average and total procedure radiation dose was in the acceptable low range (median = 1501 μGy*m(2), range 665-16,326). There were no deaths, and all patients were discharged from the hospital (median length of stay = 4 days, range 2-12). Three patients had postoperative complications: one prolonged air-leak, one pneumonia, and one ileus. CONCLUSIONS: A successful and safe step-wise process has been established for iVATS, combining intra-operative C-arm CT scanning and thoracoscopic surgery in a hybrid operating room.