The problem of joint orthogonal precoding and user scheduling in a multi-user multi-input multi-output (MU-MIMO) downlink system is considered. Based on the theoretics of subspace and vector projection, a novel orthogonal precoding matrix is designed to achieve high sum-rate capacity with low to moderate number of active users and in low SNR regions. With respect to sum-rate capacity, numerical simulations show that the proposed algorithm outperforms the zero-forcing beam-forming (ZFBF) and linear orthogonal beam-forming (OLBF).