Monte Carlo path tracing is a global illumination algorithm that simulates light transport in 3D scenes by randomly sampling paths of light. It handles indirect illumination by accounting for light bounces off surfaces, and global illumination by considering all possible light interactions.

The technique involves shooting rays from the camera into the scene, then bouncing them off surfaces until they hit a light source or exceed a maximum bounce limit. At each intersection, the algorithm calculates the contribution of direct and indirect lighting to the final pixel color using Monte Carlo integration.

Direct illumination is computed by sampling light sources directly, while indirect illumination is estimated by recursively tracing rays in random directions. This randomness introduces noise, which converges to the correct solution as more samples are taken.

To improve efficiency, importance sampling is used to prioritize rays with higher contributions to the final image. Additionally, Russian roulette termination can be employed to probabilistically terminate paths with low contributions, reducing computation time without significant loss of accuracy.