Abstract: According to the principle of analytical subsequent relative orientation, the formula of vertical parallax on corresponding point is deduced when stereo model is reconstructed by using the elements of exterior orientation of images. The method is verified by simulative images and tested by two kinds of different scale images taken from Xinjiang and Qianxi, China. Compared the vertical parallax of models reconstructed by using the elements of exterior orientation obtained by GPS-supported bundle block adjustment with that determined by position and orientation system (POS), the vertical parallaxes of models are analyzed. The experiments have shown that the vertical parallaxes of stereo models computed with POS elements of exterior orientation are intolerable. Therefore, how to eliminate vertical parallax is very important for the direct georeferencing and cartography of reconstructing stereo models.