This paper presents a corotational formulation of a spatial beam element for the purpose of 3D plastic-zone analysis of steel frames composed of compact tubular sections and open sections with no significant torsional warping. The special features of this paper, which have not been discussed in detail by other researchers, include the proposition of a torsional strain-displacement relationship for rectangular hollow sections, and the elucidation of the proper force recovery procedure for a displacement-based plastic-zone beam element. Issues concerning the miter model and the use of a consistent tangent operator in geometrically and materially nonlinear analysis are briefly discussed. Verification against three experimental tests on planar and spatial steel frames is included in the paper. It is demonstrated that in general only three cubic elements are required to model a story column with excellent accuracy, and four or five elements are sufficient for a base column with a rigid support. Such meshes are far coarser and thus considerably more efficient than those used by previous researchers for plastic-zone analysis.