In the present study, we investigate a new approach to electroencephalography (EEG) three-dimensional (3D) dipole source localization by using a non-recursive subspace algorithm called FINES. In estimating source dipole locations, the present approach employs projections onto a subspace spanned by a small set of particular vectors (FINES vector set) in the estimated noise-only subspace instead of the entire estimated noise-only subspace in the case of classic MUSIC. The subspace spanned by this vector set is, in the sense of principal angle, closest to the subspace spanned by the array manifold associated with a particular brain region. By incorporating knowledge of the array manifold in identifying FINES vector sets in the estimated noise-only subspace for different brain regions, the present approach is able to estimate sources with enhanced accuracy and spatial resolution, thus enhancing the capability of resolving closely spaced sources and reducing estimation errors. The present computer simulations show, in EEG 3D dipole source localization, that compared to classic MUSIC, FINES has (1) better resolvability of two closely spaced dipolar sources and (2) better estimation accuracy of source locations. In comparison with RAP-MUSIC, FINES' performance is also better for the cases studied when the noise level is high and/or correlations among dipole sources exist.