Spherically symmetric volume elements with smooth tapering of the values near their boundaries are alternatives to the more conventional voxels for the construction of volume images in the computer. Their use, instead of voxels, introduces additional parameters which enable the user to control the shape of the volume element (blob) and consequently to control the characteristics of the images produced by iterative methods for reconstruction from projection data. For images composed of blobs, efficient algorithms have been designed for the projection and discrete back-projection operations, which are the crucial parts of iterative reconstruction methods. The authors have investigated the relationship between the values of the blob parameters and the properties of images represented by the blobs. Experiments show that using blobs in iterative reconstruction methods leads to substantial improvement in the reconstruction performance, based on visual quality and on quantitative measures, in comparison with the voxel case. The images reconstructed using appropriately chosen blobs are characterized by less image noise for both noiseless data and noisy data, without loss of image resolution.