Development of a digital zenith telescope prototype, improved zenith camera construction and analysis of experimental vertical deflection measurements for the improvement of the Latvian geoid model have been performed at the Institute of Geodesy and Geoinformation, University of Latvia. At first, the prototype camera has been constructed and tested. Original optical system, zenith camera construction design and control and data processing software were developed and hardware components were integrated. A number of observation sessions were performed in Riga and outside Riga and a huge amount of observation data has been processed in order to evaluate prototype zenith camera properties, such as influence of fundament vibrations, convection, background lights, to find optimal structure of observation sessions. According to obtained results the design of improved zenith camera construction, based on acquired experience, has been completed. Expected accuracy of vertical deflection measurements is about 0.1".