A new imaging approach for 3-D localization and characterization of objects in a turbid medium using independent component analysis (ICA) from information theory is developed and demonstrated using simulated data. This approach uses a multisource and multidetector signal acquisition scheme. ICA of the perturbations in the spatial intensity distribution measured on the medium boundary sorts out the embedded objects. The locations and optical characteristics of the embedded objects are obtained from a Green’s function analysis based on any appropriate model for light propagation in the background medium. This approach is shown to locate and characterize absorptive and scattering inhomogeneities within highly scattering medium to a high degree of accuracy. In particular, we show this approach can discriminate between absorptive and scattering inhomogeneities, and can locate and characterize complex inhomogeneities, which are both absorptive and scattering. The influence of noise and uncertainty in background absorption or scattering on the performance of this approach is investigated.