Transrectal ultrasound guided prostate biopsies often fail to diagnose prostate cancer with 90% of cores reported as benign. Thus, it is desirable to target prostate cancer lesions while reducing the sampling of benign tissue. The concentrations of natural fluorophores in prostate tissue fluctuate with disease states. Hence, fluorescence spectroscopy could be used to quantify these fluctuations to identify prostate cancer. An optical biopsy needle with a light sensitive optical probe at the tip of the inner needle was developed to take prostate biopsies after measuring tissue fluorescence with a laboratory fluorometer. The optical probe consists of eight 100 μm fibers for tissue excitation and a single 200 μm fiber to capture fluorescence spectra. Random biopsy cores were taken from 20 surgically excised prostates after measuring fluorescence spectra of tissue between 295-550nm for several excitations between 280-350nm. Each biopsy core was histopathologically classified and correlated with corresponding spectra. Prostate biopsies were grouped into benign or malignant based on the histological findings. Out of 187 biopsy cores, 109 were benign and 78 were malignant. Partial least square analysis of tissue spectra was performed to identify diagnostically significant principal components as potential classifiers. A linear support vector machine and leave-one-out cross validation method was employed for tissue classification. Study results show 86% sensitivity, 87% specificity, 90% negative predictive value, and 83% positive predictive value for benign versus malignant prostate tissue classification. This study demonstrates potential clinical applications of fluorescence spectroscopy guided optical biopsy needle for prostate cancer diagnosis with the consequent improvement of patient care.