A system and method for magnetic resonance imaging (MRI) of a subject employs an elongate housing configured to be held and manipulated in a user's hand. The housing supports at least one permanent magnet and at least one RF coil. A device positioning subsystem measures position and orientation of the housing. An electronic subsystem interfaces to the at least one RF coil and to the device positioning subsystem. The electronic subsystem is configured to i) execute pulse sequences where each pulse sequence transmits at least one RF pulse into body tissue of the subject and acquires MRI signals from the body tissue of the subject, ii) acquire position data representing position and orientation of the housing during the pulse sequences from the device positioning subsystem, and iii) process the MRI signals of i) together with the position data of ii) to derive an image of the body tissue of the subject.