An efficient Gauss-Newton iterative imaging technique utilizing a three-dimensional (3-D) field solution coupled to a two-dimensional (2-D) parameter estimation scheme (3-D/2-D) is presented for microwave tomographic imaging in medical applications. While electromagnetic wave propagation is described fully by a 3-D vector field, a 3-D scalar model has been applied to improve the efficiency of the iterative reconstruction process with apparently limited reduction in accuracy. In addition, the image recovery has been restricted to 2-D but is generalizable to three dimensions. Image artifacts related primarily to 3-D effects are reduced when compared with results from an entirely two-dimensional inversion (2-D/2-D). Important advances in terms of improving algorithmic efficiency include use of a block solver for computing the field solutions and application of the dual mesh scheme and adjoint approach for Jacobian construction. Methods which enhance the image quality such as the log-magnitude/unwrapped phase minimization were also applied. Results obtained from synthetic measurement data show that the new 3-D/2-D algorithm consistently outperforms its 2-D/2-D counterpart in terms of reducing the effective imaging slice thickness in both permittivity and conductivity images over a range of inclusion sizes and background medium contrasts.