Abstract: A new observation equation of the dead reckoning (DR) system for land vehicle navigation is presented, and a modified adaptive extended Kalman filter and its filtering algorithm for the DR system are proposed. By consideration of Markov process component in the random drift of rate gyros, and application of a current statistical model and adaptive algorithm for estimating maneuvering vehicles, the accuracy of the DR system model is greatly improved.Furthermore, in order to enhance the robustness and dynamatic performance of the extended kalman filter, a new adaptive filtering algorithm is researched.Computer simulation results show that the positioning accuracy and possiblility of the DR system can be greatly improved by this filter and adaptive algorithm.