Abstract: Pulmonary nodules (PNs), a critical imaging indicator for early lung cancer screening, require deeper mechanistic exploration of their malignant transformation. Current Western medicine strategies—primarily surveillance—suffer from delayed intervention, while traditional Chinese medicine (TCM) theories (e.g., "phlegm-blood stasis binding") inadequately explain the dynamic progression of malignancy. Integrating You Yi's theory of "where there is mass hardness, there must be latent yang" with modern research on PN malignant transformation, this study proposes a novel pathogenic mechanism of "latent yang as cause, mass hardness as effect": Depressed latent yang drives pro-tumorigenic microenvironments (e.g., immunosuppression, hypoxic stress, chronic inflammation), leading to the coagulation of phlegm, stasis, fire, and toxins into cancer toxin. Based on this framework, a core therapeutic principle of "dispersing latent yang and intercepting malignant transition in stages" was established, providing a new paradigm for TCM-based early intervention against PN malignancy.