Dual-energy x-ray technique, which consists in combining two radiographs acquired at two kilovoltage, can improve the identity of the compositions of object over regular CT, or at least improve image contrast. Dual-energy equations can be easily written and solved for ideally monochromatic x-ray source and perfect detector, but become complex when considering polychromatic x-ray source, detector sensitivity, and system non–linearity. In this paper, a new dual-energy algorithm which employed the basis material decomposition method was investigated for improving material separation capability. Studies by using computer-simulated data were performed to validate and evaluate the algorithm. The preliminary results of the study show that, with the proposed algorithm, separated “material specific” images of dual-material object could be obtained. Also monochromatic image can be acquired at arbitrary desired energy which could enhance image contrast in comparison with conventional reconstructed image.