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This paper presents a new method for extraction of buildings in aerial images. We first present a method based on rectangular buildings, which are the most common constructions. We then extend this method to more complex shapes by decomposition in a set of rectangles. These rectangles are used to enhance a 3D reconstruction of the digital elevation model (DEM). Based on stereo data, we use the DEM and the orthoimage for a first segmentation of all areas at elevation above ground. We estimate the rectangle parameters over any given blob and define a criterion for checking the similarity between shape and model. We introduce a new approach for automatic reconstruction of buildings of complex shapes using an iterative splitting of the region until it is covered by a set of rectangles. This automatic process is successfully illustrated on synthetic and real examples. In order to refine location and size of the model, we present a deformable rectangle template. The final rectangle and complex shape models are used together with elevation to obtain a 3D realistic reconstruction of the scene including building models.