We describe an algorithm for simultaneous refinement of a three-dimensional (3-D) density map and of the orientation parameters of two-dimensional (2-D) projections that are used to reconstruct this map. The application is in electron microscopy, where the 3-D structure of a protein has to be determined from a set of 2-D projections collected at random but initially unknown angles. The design of the algorithm is based on the assumption that initial low resolution approximation of the density map and reasonable guesses for orientation parameters are available. Thus, the algorithm is applicable in final stages of the structure refinement. when the quality of the results is of main concern. We define the objective function to be minimized in real space and solve the resulting nonlinear optimization problem using a Quasi-Newton algorithm. We calculate analytical derivatives with respect to density distribution and the finite difference approximations of derivatives with respect to orientation parameters. We demonstrate that calculation of derivatives is robust with respect to noise in the data. This is due to the fact that noise is annihilated by the back-projection operations. Our algorithm is distinguished from other orientation refinement methods (i) by the simultaneous update of the density map and orientation parameters resulting in a highly efficient computational scheme and (ii) by the high quality of the results produced by a direct minimization of the discrepancy between the 2-D data and the projected views of the reconstructed 3-D structure. We demonstrate the speed and accuracy of our method by using simulated data. (C) 2004 Elsevier Inc. All rights reserved.