A method and a system for progressive stereo matching of digital images representing a scene. In general, the present invention uses a progressive iterative technique that includes a disparity gradient limit principle and a least commitment strategy. Generally unambiguous pixel matches are found by beginning with a few reliable pixel matches and finding progressively more unambiguous pixel matches. Unambiguous pixel matches are used to define the search ranges for each pixel to guide matching in the current iteration. Unambiguous pixel matches then are found using a novel correlation technique and based on a correlation score associated with a pixel match. The search range is capable of being rotated, and is part of a novel correlation technique that provides a more robust estimate of pixel match reliability. Potential pixel matches found in the search ranges are tested for ambiguity and unambiguous matches are selected and added to the reliable pixel matches.