An extension of the density-matrix renormalization-group (DMRG) method is p
resented. Besides the two groups or classes of block states considered in W
hite's formulation, the retained nz states, and the neglected ones, we intr
oduce an intermediate group of block states having the following p largest
eigenvalues hi of the reduced density matrix: lambda(1)greater than or equa
l to...greater than or equal to lambda(m)greater than or equal to lambda(m1)greater than or equal to...greater than or equal to lambda(m+p). These st
ates are taken into account when they contribute to intrablock transitions
but are neglected when they participate in more delocalized interblock fluc
tuations. Applications to one-dimensional models (Heisenberg, Hubbard, and
dimerized tight binding) show that in this way the involved computer resour
ces can be reduced without significant loss of accuracy. The efficiency and
accuracy of the method is analyzed by varying m and p and by comparison wi
th standard DMRG calculations. A Hamiltonian-independent scheme for choosin
g m and p and for extrapolating to the limit where m and p are infinite is
provided. Finally, an extension of the 3-classes approach is outlined, whic
h incorporates the fluctuations between the p states of different blocks as
a self-consistent dressing of the block interactions among the retained m
states. [S0163-1829(98)03943-5].