The radiative transfer equations for a coupled atmosphere and canopy are solved numerically by an improved Gause-Seidel iteration algorithm. The radiation field is decomposed into three components: unscattered sunlight, single scattering, and multiple scattering radiance for which the corresponding equations and boundary conditions are set up and their analytical or iterational solutions are explicitly derived. The classic Guass-Seidel algorithm has been widely applied in atomospheric research. This is its first application for calculating the multiple scattering radiance of a coupled atmosphere and canopy. This algorithm enables us to obtain the internal radiation field as well as radiances at boundaries. Any form of bidirectional reflectance distribution function (BRDF) as a boundary condition can be easily incorporated into the iteration procedure. The hotspot effect of the canopy is accommodated by means of the modification of the extiniction coefficients of upward single scattering radiation and unscatteered sunlight using the formulation of Nilson and Kuusk. To reduce the computation for the case of large optical thickness, an improved iteration formula is derived to speed convergence. The upwelling radiances have been evaluated for different atmospheric conditions, leaf area index (LAI), leaf angle distribution (LAD), leaf size and so on. The formulation presented in this paper is also well suited to analyze the relative magnitude of multiple scattering radiance and single scattering radiance in both the visible and near infrared regions.