Lymphoedema tissue is characterised by excess free fluid and structural changes to the extracellular matrix (ECM) in the form of fibrotic and fatty deposition. These tissue characteristics are integral to the assessment of lymphoedema progression; however, clinicians and researchers often focus on changes in the free fluid, volume and function of lymphatic vasculature to inform practice. Subsequently, little is known about the effect of clinical interventions on lymphoedema tissue composition. This article presents a novel approach to classify lymphoedema tissue. The Localised Objective Characterisation Assessment of Lymphoedema (LOCAL) classification combines diagnostic and clinically meaningful objective assessment thresholds to infer lymphoedema pathophysiological changes in tissue layers. The LOCAL classification method was verified using data from fifteen women with unilateral breast cancer-related lymphoedema who were evaluated at three sites on each arm using high-frequency ultrasound (HFUS), bio-electrical impedance spectroscopy (BIS) and volume measurements. Participants exhibited an uneven distribution of volume between the proximal and distal segments of the arm (p = 0.023), with multiple tissue compositional categories observed across sites on the same limb (p < 0.001). The LOCAL method demonstrated utility in categorising a diverse range of lymphoedema tissue layer changes beyond what can be ascertained from whole-limb measures.