OBJECTIVES: I. Compare disease free survival and overall survival of postmenopausal women with stage II or IIIA breast cancer treated with tamoxifen (TMX) and fenretinide (HPR) vs TMX and placebo. II. Gain wider experience in the use and toxicity of combined TMX/HPR in these patients. III. Obtain tumor tissue samples, as feasible, from these patients for future biologic studies.