— This paper presents a novel multifunctional multiple-input multiple-output (MIMO) scheme that combines the benefits of the Vertical Bell Labs Layered Space-Time (VBLAST) scheme, of Space-Time Codes (STC) as well as of beamforming. Further system performance improvements can be attained by serially concatenated convolutional encoding combined with a unity-rate code (URC) referred to as a precoder. Then, at the receiver side, iterative decoding is invoked by exchanging extrinsic information between the precoder’s decoder as well as the outer Recursive Systematic Convolutional (RSC) code’s decoder. Moreover, the convergence behaviour of the proposed system is evaluated with the aid of Extrinsic Information Transfer (EXIT) charts. Finally, we quantify the maximum achievable rate of the system based on EXIT charts and demonstrate that the iterative-detection-aided system is capable of operating within 1 dB from the maximum achievable rate.