A sophisticated THz system with 3D imaging and narrow band spectroscopy capability is presented in the paper. The key system components are the THz source, THz detector/mixer array, scanning optics, and the signal processing unit. The system is all electronic and is portable. A battery operation option allows several hours of autonomy. The most important parameters of the THz source are output power, illumination beam size and directivity, frequency modulation range, and maximal modulation frequency. The low phase noise is also a very important parameter. Optimization of these parameters is discussed in the paper. The THz source is all solid state, composed of a phase-locked oscillator, an amplifier, and frequency multipliers. The most important element of the THz system is its sensor, which performs both signal detection and at the same time mixing of the LO signal and received signal from the target. The sensor is antenna coupled nanobolometer fabricated in a linear array of eight pixels. The sensors are suspended in the vacuum to achieve an excellent signal-to-noise ratio. The quadratic characteristic of the nano-bolometer extends over six decades allowing a large dynamic range and very high LO signal levels. The scanning mirror integrated into the system allows imaging of 1024 to 8162 pixels in the x and y dimensions that are expanded to the third dimension with a resolution of few micrometers.