The purpose of this study was to examine the spatial resolution of a prototype pendant-geometry cone-beam breast computed tomography (CT) system. Modulation transfer functions (MTFs) of the reconstructed image in the coronal (x and y) plane were computed as a function of the cone angle, the radial distance from the axis of rotation, the size of the reconstruction matrix, the back-projection filter used, and the number of projections acquired for the reconstruction. The results show that the cone angle and size of the reconstruction matrix have minimal impact on the MTF, while the MTF degraded radially from the axis of rotation (from 0.76 at 2.6 mm from axis of rotation down to 0.37 at 76.9 mm from axis of rotation at f=0.5 mm(-1)). The Ramp reconstruction filter increases the MTF near the axis of rotation relative to the Shepp-Logan filter, while an increase in the number of projections from 500 to 1000 increased the MTF near the periphery of the reconstructed image. The MTF in the z direction (anterior-posterior direction) was also evaluated. The z-direction MTF values tend to be higher when compared to the coronal MTF (0.85 at f =0.5 mm(-1)), and tend to be very constant throughout the coronal plane direction. The results suggest that an increase in the MTF for the prototype breast CT system is possible by optimizing various scanning and reconstruction parameters.