Simultaneous capturing of ultrasound (US) and magnetic resonance (MR) images allows fusion of information obtained from both modalities. We propose an MR-compatible US system where MR images are acquired in a known orientation with respect to the US imaging plane and concurrent real-time imaging can be achieved. Compatibility of the two imaging devices is a major issue in the physical setup. Tests were performed to quantify the radio frequency (RF) noise introduced in MR and US images, with the US system used in conjunction with MRI scanner of different field strengths (0.5 T and 3 T). Furthermore, simultaneous imaging was performed on a dual modality breast phantom in the 0.5 T open bore and 3 T close bore MRI systems to aid needle-guided breast biopsy. Fiducial based passive tracking and electromagnetic based active tracking were used in 3 T and 0.5 T, respectively, to establish the location and orientation of the US probe inside the magnet bore. Our results indicate that simultaneous US and MR imaging are feasible with properly-designed shielding, resulting in negligible broadband noise and minimal periodic RF noise in both modalities. US can be used for real time display of the needle trajectory, while MRI can be used to confirm needle placement.