A new optical technique is described for measurement of absolute distance. The approach is based upon a wavelength multiplexed heterodyne interferometer with FM demodulation. By temporally multiplexing discrete wavelengths in a heterodyne interferometer, a complete elimination of interferometric range ambiguity can be achieved while maintaining the high range sensitivity and resolution of interferometry. The basic theory is presented and an algorithm is described for measurement of range over meter distances with submicrometer resolution. The experimental implementation of the wavelength multiplexed interferometer is described and ranging results with 2 μm resolution from 20 cm are presented. A scanned three-dimensional map of a surface contour with 3-mm topography is also presented.