Background Blue laser imaging (BLI) is a new image-enhanced endoscopy technique that utilizes a laser light source developed for narrow-band light observation. The aim of this study was to evaluate the usefulness of BLI for the diagnosis of early gastric cancer. Methods This single center prospective study analyzed 530 patients. The patients were examined with both conventional endoscopy with white-light imaging (C-WLI) and magnifying endoscopy with BLI (M-BLI) at Kyoto Prefectural University of Medicine between November 2012 and March 2015. The diagnostic criteria for gastric cancer using M-BLI included an irregular microvascular pattern and/or irregular microsurface pattern, with a demarcation line according to the vessel plus surface classification system. Biopsies of the lesions were taken after C-WLI and M-BLI observation. The primary end point of this study was to compare the diagnostic performance between C-WLI and M-BLI. Results We analyzed 127 detected lesions (32 cancers and 95 non-cancers). The accuracy, sensitivity, and specificity of M-BLI diagnoses were 92.1, 93.8, and 91.6 %, respectively. On the other hand, the accuracy, sensitivity, and specificity of C-WLI diagnoses were 71.7, 46.9, and 80.0 %, respectively.Conclusions M-BLI had improved diagnostic performance for early gastric cancer compared with C-WLI. These results suggested that the diagnostic effectiveness of M-BLI is similar to that of magnifying endoscopy with narrow-band imaging (M-NBI).