A system for characterizing periodic structures on a real time basis is disclosed. A multi-parameter measurement module generates output signals as a function of wavelength or angle of incidence. The output signals are supplied to a parallel processor, which creates an initial theoretical model and calculates the theoretical optical response. The calculated optical response is compared to measured values. Based on the comparison, the model configuration is modified to be closer to the actual measured structure. Thereafter, the complexity of the model is iteratively increased, by dividing the model into layers each having an associated width and height. The model is fit to the data in an iterative manner until a best fit model is obtained which is similar in structure to the periodic structure.