MODTRAN4, the newly released version of the U.S. Air Force atmospheric transmission, radiance and flux model is being developed jointly by the Air Force Research Laboratory / Space Vehicles Directorate (AFRL / VS) and Spectral Sciences, Inc. It is expected to provide the accuracy required for analyzing spectral data for both atmospheric and surface characterization. These two quantities are the subject of satellite and aircraft campaigns currently being developed and pursued by, for instance: NASA (Earth Observing System), NPOESS (National Polar Orbiting Environmental Satellite System), and the European Space Agency (GOME - Global Ozone Monitoring Experiment). Accuracy improvements in MODTRAN relate primarily to two major developments: (1) the multiple scattering algorithms have been made compatible with the spectroscopy by adopting a correlated-^ approach to describe the statistically expected transmittance properties for each spectral bin and atmospheric layer, and (2) radiative transfer calculations can be conducted with a Beer-Lambert formulation that improves the treatment of path inhomogeneities. Other code enhancements include the incorporation of solar azimuth dependence in the DISORT-based multiple scattering model, the introduction of surface BRDF (Bi-directional Radiance Distribution Functions) models and a 15 cm-1 band model for improved computational speed. Finally, recent changes to the HITRAN data base, relevant to the 0.94 and 1.13 um bands of water vapor, have been incorporated into the MODTRAN4 databases.