A new simulation method is presented for low-Reynolds-number flow problems involving elongated particles in an unbounded fluid. The technique extends the principles of Stokesian dynamics, a multipole moment expansion method, to ellipsoidal particle shapes. The methodology is applied to prolate spheroids in particular, and shown to be efficient and accurate by comparison with other numerical methods for Stokes flow. The importance of hydrodynamic interactions is illustrated by examples on sedimenting spheroids and particles in a simple shear flow.