A multichannel spectrally resolved optical tomography system to image molecular targets in small animals from within a clinical MRI is described. Long source/detector fibers operate in contact mode and couple light from the tissue surface in the magnet bore to 16 spectrometers, each containing two optical gratings optimized for the near infrared wavelength range. High sensitivity, cooled charge coupled devices connected to each spectrograph provide detection of the spectrally resolved signal, with exposure times that are automated for acquisition at each fiber. The design allows spectral fitting of the remission light, thereby separating the fluorescence signal from the nonspecific background, which improves the accuracy and sensitivity when imaging low fluorophore concentrations. Images of fluorescence yield are recovered using a nonlinear reconstruction approach based on the diffusion approximation of photon propagation in tissue. The tissue morphology derived from the MR images serves as an imaging template to guide the optical reconstruction algorithm. Sensitivity studies show that recovered values of indocyanine green fluorescence yield are linear to concentrations of 1 nM in a 70 mm diameter homogeneous phantom, and detection is feasible to near 10 pM. Phantom data also demonstrate imaging capabilities of imperfect fluorophore uptake in tissue volumes of clinically relevant sizes. A unique rodent MR coil provides optical fiber access for simultaneous optical and MR data acquisition of small animals. A pilot murine study using an orthotopic glioma tumor model demonstrates optical-MRI imaging of an epidermal growth factor receptor targeted fluorescent probe in vivo.