A state-selective multireference coupled-cluster algorithm is presented which is capable of describing single, double (or higher) excitations from an arbitrary complete model space. One of the active space determinants is chosen as a formal Fermi-vacuum and single, double (or higher) excitations from the other reference functions are considered as higher excitations from this determinant as it has been previously proposed by Oliphant and Adamowicz [J. Chem. Phys. 94, 1229 (1991)]. Coupled-cluster equations are generated in terms of antisymmetrized diagrams and restrictions are imposed on these diagrams to eliminate those cluster amplitudes which carry undesirable number of inactive indices. The corresponding algebraic expressions are factorized and contractions between cluster amplitudes and intermediates are evaluated by our recent string-based algorithm [J. Chem. Phys. 115, 2945 (2001)]. The method can be easily modified to solve multireference configuration interaction problems. Performance of the method is demonstrated by several test calculations on systems which require a multireference description. The problem related to the choice of the Fermi-vacuum has also been investigated.