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This paper concerns forest parameter retrieval from polarimetric interferometric synthetic aperture radar (PolInSAR) data considering two layers, one for the ground under the vegetation and one for the volumetric canopy. A model is designed to combine a physical model-based polarimetric decomposition with the random-volume-over-ground (RVoG) PolInSAR parameter inversion approach. The combination of a polarimetric scattering media model with a PolInSAR RVoG vertical structure model provides the possibility to separate the ground and the volume coherency matrices based on polarimetric signatures and interferometric coherence diversity. The proposed polarimetric decomposition characterizes volumetric media by the degree of polarization orientation randomness and by the particle scattering anisotropy. Using the full model enhances the estimation of the vertical forest structure parameters by enabling us to estimate the ground-to-volume ratio, the temporal decorrelation, and the differential extinction. For forest vegetation observed at L-band, this model accounts for the ground topography, forest and canopy layer heights, wave attenuation in the canopy, tree morphology in the form of the angular distribution and the effective shapes of the branches, and the contributions from the ground level consisting of surface scattering and double-bounce ground-trunk interactions, as well as volumetric understory scattering. The parameter estimation performance is evaluated on real airborne L-band SAR data of the Traunstein test site, acquired by the German Aerospace Center (DLR)'s E-SAR sensor in 2003, in both single- and multibaseline configurations. The retrieved forest height is compared with the ground-truth measurements, revealing, for the given test site, an average root-mean-square error (rmse) of about 5 m in the repeat-pass configuration. This implies an improvement in rmse by over 2 m in comparison to the pure coherence-based RVoG PolInSAR parameter inversion.