An extension to the two-step physical retrieval algorithm was developed. Combined clear-sky multitemporal and multispectral observations were used to retrieve the atmospheric temperature-humidity profile, land-surface temperature, and surface emissivities in the midwave (3-5 microns) and long-wave (8-14.5 microns) regions. The extended algorithm was tested with both simulated and real data from the Moderate-Resolution Imaging Spectroradiometer (MODIS) Airborne Simulator. A sensitivity study and error analysis demonstrate that retrieval performance is improved by the extended algorithm. The extended algorithm is relatively insensitive to the uncertainties simulated for the real observations. The extended algorithm was also applied to real MODIS daytime and nighttime observations and showed that it is capable of retrieving medium-scale atmospheric temperature water vapor and retrieving surface temperature emissivity with retrieval accuracy similar to that achieved by the Geostationary Operational Environmental Satellite (GOES) but at a spatial resolution higher than that of GOES.