Over-parameterization and over-correction are two of the major problems in the rational function model (RFM). A new approach of optimized RFM (ORFM) is proposed in this paper. By synthesizing stepwise selection, orthogonal distance regression, and residual systematic error correction model, the proposed ORFM can solve the ill-posed problem and over-correction problem caused by constant term. The least square, orthogonal distance, and the ORFM are evaluated with control and check grids generated from satellite observation Terre (SPOT-5) high-resolution satellite data. Experimental results show that the accuracy of the proposed ORFM, with 37 essential RFM parameters, is more accurate than the other two methods, which contain 78 parameters, in cross-track and along-track plane. Moreover, the over-parameterization and over-correction problems have been efficiently alleviated by the proposed ORFM, so the stability of the estimated RFM parameters and its accuracy have been significantly improved.