Buffett said he was diagnosed April 11 and has received tests, including a CAT scan, a bone scan and an MRI.
Buffett is known for a no-nonsense approach to investing. He is one of the world's richest men and, in recent years, has become one of its most generous philanthropists.
Buffett's stake in Berkshire Hathaway was worth more than $43 billion as of December.
He told shareholders in February that Berkshire's board has chosen someone to succeed him as CEO someday and he said there are two backup candidates.
None of the three has been identified.
Buffett said then that last year's departure of a top executive, David Sokol, did not affect the board's choice for successor.
Buffett has said Berkshire, which in Utah owns home furnisher RC Willey and Rocky Mountain Power, plans to split his job into three parts with a CEO, a chairman and several investment managers. And he has said his son Howard, a member of Berkshire's board, would make an ideal chairman.
The AFL-CIO, as a major investor, has proposed that Berkshire shareholders be able to vote at their annual meeting in May on whether the company should be compelled to disclose more specifics about its succession plan.
Berkshire owns more than 80 companies, including clothing, furniture, brick and jewelry firms. Its insurance, railroad and utility businesses typically account for more than half of its net income. It also has major investments in such companies as American Express Co., International Business Machines Corp., Washington Post Co. and Wells Fargo & Co.
Although Buffett's investment success has made his a household name nationwide and made him a Wall Street oracle he still works in his hometown of Omaha and lives in a house he bought in 1958.
About 240,000 men in the U.S. are diagnosed with prostate cancer each year.
Many prostate cancer patients with slow-growing tumors can live their whole lives without symptoms or treatment, according to the American Cancer Society. Many die of something else before the cancer kills them.
Buffett concluded his letter with a nod to that fact.
"I will let shareholders know immediately should my health situation change," he wrote. "Eventually, of course, it will; but I believe that day is a long way off."
Berkshire's class B shares rose $1.09 Tuesday to close at $80.76. They fell $1.28 after hours following the release of Buffett's letter.