We present a combined near-infrared diffuse optical spectroscopy (DOS) and Magnetic Resonance Imaging (MRI) system for the study of animal model tumors. A combined broadband steady-state and frequency domain optical spectroscopy apparatus was integrated with the MRI. The physiological properties of tissue rendered by MRI, including vascular volume fraction and water, were compared with chromophore concentrations as determined from the parameters obtained by optical measurements. DOS measurements provided oxy-hemoglobin, deoxy-hemoglobin, and water concentration locally in tumors. A method for co-registration of the information obtained by both modalities was developed. Using Monte Carlo simulations, the optically sampled volume was superimposed on the MR images, illustrating which tissue structure was probed optically. Finally, two optical contrast agents, indocyanine green (ICG) and methylene blue (MB), were employed and their kinetics were measured by DOS system from different locations on the tumor and compared with Gd-DTPA enhancement maps obtained from MRI.