RATIONALE: Drugs used in chemotherapy use different ways to stop tumor cells from dividing so they stop growing or die. Radiation therapy uses high-energy x-rays to damage tumor cells. Combining more than one drug with either standard radiation therapy or radiation therapy given at different times may kill more tumor cells.

PURPOSE: Randomized phase III trial to compare the effectiveness of combination chemotherapy consisting of paclitaxel and carboplatin, plus either standard radiation therapy or radiation therapy given at different times, in treating patients with stage III non-small cell lung cancer that cannot be surgically removed.

OBJECTIVES: I. Determine response rates, duration of response, and survival of patients with unresectable or regionally advanced (M0) stage IIIA or IIIB non-small cell lung carcinoma treated with induction paclitaxel and carboplatin followed by conventional vs accelerated radiation. II. Evaluate the patterns of local and distant failure for patients treated with these regimens.

OUTLINE: Patients are stratified by histology (squamous vs nonsquamous), performance status (0 vs 1), disease stage (IIIA vs IIIB), and response to induction chemotherapy (initial response vs no response). All patients receive induction therapy consisting of paclitaxel IV over 3 hours followed by carboplatin IV over 30 minutes on days 1 and 22. Treatment repeats every 42 days for 2 courses. Patients whose disease has not progressed outside the thorax are then randomized to 1 of 2 treatment arms. Arm I: Patients receive standard radiotherapy once a day, 5 days a week for 6-7 weeks. Arm II: Patients receive hyperfractionated accelerated radiotherapy 3 times daily, 5 days a week over 2.5 weeks. Each fraction is separated by a minimum of 4 hours. Radiotherapy begins between days 43 and 50. Patients are followed at 1 month after radiotherapy, then every 3 months for 2 years, every 6 months for the next 3 years, and annually thereafter.

PROJECTED ACCRUAL: Approximately 294 patients will be accrued for this study within 3.5 years.

DISEASE CHARACTERISTICS: Histologically confirmed unresectable stage IIIA or IIIB non-small cell carcinoma of the lung Adenocarcinoma Squamous cell carcinoma Anaplastic large cell carcinoma Stage IIIA patients must not be candidates for resection after neoadjuvant therapy (unresectable T3N1 or T1-3 primary tumors with metastasis limited to the ipsilateral mediastinal and subcarinal lymph nodes) Mediastinotomy or thoracoscopy required for potentially resectable IIIa disease when ipsilateral mediastinal lymph nodes are less than 2 cm Stage IIIB patients must not have significant pleural effusion (seen on CT scan only OR does not reaccumulate after one thoracentesis and is cytologically negative) Metastases to contralateral mediastinal or supraclavicular nodes allowed Measurable or evaluable disease No distant metastasis or significant pleural effusion

PATIENT CHARACTERISTICS: Age: 18 and over Performance status: ECOG 0-1 Life expectancy: At least 12 weeks Hematopoietic: WBC at least 3,500/mm3 Platelet count at least 100,000/mm3 Granulocyte count at least 1,500/mm3 Hemoglobin at least 10 g/dL Hepatic: Bilirubin less than 1.5 mg/dL SGOT no greater than 2 times normal No liver disease with significant hepatic insufficiency Renal: Creatinine no greater than 1.5 mg/dL OR Creatinine clearance at least 50 mL/min Cardiovascular: No cardiac arrhythmia or end stage congestive heart failure Neurologic: No preexisting clinically significant peripheral neuropathy No organic brain syndrome Other: No history of prior or concurrent malignancy in the past 5 years except: Surgically cured basal cell carcinoma of the skin Carcinoma in situ of the cervix Not pregnant Fertile patients must use effective contraception during and for 2 weeks after study

PRIOR CONCURRENT THERAPY: Biologic therapy: Not specified Chemotherapy: No prior systemic chemotherapy Endocrine therapy: Not specified Radiotherapy: No prior thoracic radiotherapy Surgery: Not specified