The purpose of this work is to investigate the impact of Digital Elevation Model (DEM) vertical accuracy on the orthoimage production process. The study took place on a QuickBird image through using four different DEMs with different vertical accuracies, 9 GCPs and three sensor models. The four DEMs are: GPS based DEM; topographic map based DEM; Shuttle Radar Topography Mission (SRTM) based DEM; and Advanced Spaceborne Thermal Emission and Reflection (ASTER) based DEM. The used sensor models are: the Rigorous Sensor Model (RSM); Raional Functional Model (RFM) and refined RFM. The results show that the RFM (without GCPs) gives inaccurate results especially in case of high spatial resolution satellite images. The research recommends the use of rigorous model and the refined RFM for orthorectifying images accurately as the results showed that these two models give accurate, precise and stable results. ِِAs well, their results do not contain systematic errors.