Abstract: Considering the influences of the accumulation errors of inertial navigation system (INS) and the principle shortcoming of traditional terrain contour matching (TERCOM) algorithm for underwater geomagnetic matching navigation,an improved TERCOM method is presented. A new matching criterion based on the Hausdorff distance is used in the system algorithm. The improved TERCOM algorithm is analyzed by increasing the rotation change,determining the optimum rotation angle automatically,and getting the precision matching result in appropriate matching area,which obviously improves the accuracy and credibility of underwater geomagnetic matching navigation compared with to traditional TERCOM algorithms. The new algorithm is verified by experiments.