We consider in this paper a class of nonlinear least squares problems in which the model can be represented as a linear combination of nonlinear functions. The variable projection algorithm projects the linear parameters out of the problem, leaving the nonlinear least squares problems involving only the nonlinear parameters. To implement the variable projection algorithm more efficiently, we propose a new variable projection functional based on matrix decomposition. The advantage of the proposed formulation is that the size of the decomposed matrix may be much smaller than those of previous ones. The Levenberg-Marquardt algorithm using finite difference method is then applied to minimize the new criterion. Numerical results show that the proposed approach achieves significant reduction in computing time.