Transverse mode characteristics of vertical cavity surface‐emitting (VC‐SE) lasers are described. The mode structure is investigated as a function of the transverse dimension for proton‐implanted gain‐guided VC‐SE lasers. A comparison is made to an air‐post index‐guided structure. The lasing modes and the evolution of the modes with increasing drive current for the VC‐SE lasers are observed to be highly analogous to those of the edge‐emitting lasers. Broad‐area gain‐guided lasers lase in the fundamental TEM00mode near threshold. At higher currents, high‐order modes are successively excited. A 5 &mgr;m square proton‐implanted gain‐guided VC‐SE laser emits a single mode. On the other hand, an air‐post index‐guided SE laser, due to the large index difference between the laser and the cladding, emits multiple transverse modes. Moreover, we show that the gain‐guided VC‐SE lasers exhibit better device characteristics than the air‐post index‐guided lasers.