The standard technique for computing ocean wave-radar modulation transfer functions (MTFs) depends on nonparametric fast Fourier transform (FFT) methods. In this paper we suggest a new approach applying an autoregressive (AR) parametric spectral estimator. The analysis shows that the two-channel autoregressive model produces smooth estimates of the MTF and permits better frequency resolution than FFT techniques. The feed-across effect inherent in the methods developed to evaluate the multichannel AR coefficients causes a negligible effect on MTF. The AR-based MTF depends weakly on the record length, for steady meteorological conditions the AR model of the MTF for a 2-min data run is comparable with ones calculated using 10 min or more of data. In the same situation the FFT technique is unreliable for records of less than 10 min. The appropriate order of the multichannel AR model can vary without causing significant change in the MTF. In most cases any order between 8 and 16, depending on radar system parameters and meteorological conditions, will give acceptable results. ¿ American Geophysical Union 1993