In this paper we describe a project for designing, developing and translating a THz imaging device for monitoring margins from extracted tissue during surgical breast cancer conservation procedures. In this application, the reflective and transmission properties of extracted tissue are monitored, in near real-time using a fine-beam THz signal which is sensitive to the presence of liquid and bound water content. In this way, it is intended that the extracted tissue will be studied in the operating theatre to determine during surgery, whether or not the region of malignant tissue has been fully excised from the patient. In the early stages of this project, we are determining to what degree an existing THz system at the University of Massachusetts (UMass) in Amherst is able to differentiate between breast carcinoma, normal fibroglandular and adipose tissues. This is achieved through close collaboration with a surgical and radiological team at the UMass-Worcester medical school and involves post-surgical recovered tissues. As part of this work, we are describing the system, measurement methodology, and first results that were obtained to calibrate the imaging system.