OUTLINE: This is a randomized, double blind, placebo controlled, multicenter study. Patients are randomized to one of three treatment arms. All patients receive paclitaxel IV over 3 hours followed by carboplatin IV over 15-30 minutes on day 1. Patients receive lower dose oral ZD 1839 (arm I), higher dose oral ZD 1839 (arm II), or placebo (arm III) twice on day 1, and then once daily thereafter. Chemotherapy repeats every 3 weeks for a maximum of 6 courses. ZD 1839 or placebo continues daily in the absence of disease progression or unacceptable toxicity. Quality of life is assessed prior to study, then every 3 weeks until completion of chemotherapy, then every 4 weeks until completion of oral ZD 1839 or placebo, and then every 8 weeks thereafter. Patients are followed every 8 weeks.