The presence of vegetation and the terrain topography itself generate strong occlusions causing large gaps in terrestrial laser scanning (TLS) data at the ground level as well as a risk of integrating above-ground objects. This article introduces a surface-approximation algorithm dedicated to extracting digital terrain models (DTMs) from terrestrial TLS data acquired in forest areas. The proposed method is based on the combination of a quadtree subdivision of space guided by the local density and distribution of data together with a surface modeling via radial basis functions, which are used as partitions of unity for merging local quadratic approximating patches.