diff --git a/flight/modules/StateEstimation/filterbaro.c b/flight/modules/StateEstimation/filterbaro.c
new file mode 100644
index 000000000..6cda6b175
--- /dev/null
+++ b/flight/modules/StateEstimation/filterbaro.c
@@ -0,0 +1,97 @@
+/**
+ ******************************************************************************
+ * @addtogroup OpenPilotModules OpenPilot Modules
+ * @{
+ * @addtogroup State Estimation
+ * @brief Acquires sensor data and computes state estimate
+ * @{
+ *
+ * @file       filterbaro.c
+ * @author     The OpenPilot Team, http://www.openpilot.org Copyright (C) 2013.
+ * @brief      Barometric altitude filter, calculates altitude offset based on
+ *             GPS altitude offset if available
+ *
+ * @see        The GNU Public License (GPL) Version 3
+ *
+ ******************************************************************************/
+/*
+ * This program is free software; you can redistribute it and/or modify
+ * it under the terms of the GNU General Public License as published by
+ * the Free Software Foundation; either version 3 of the License, or
+ * (at your option) any later version.
+ *
+ * This program is distributed in the hope that it will be useful, but
+ * WITHOUT ANY WARRANTY; without even the implied warranty of MERCHANTABILITY
+ * or FITNESS FOR A PARTICULAR PURPOSE. See the GNU General Public License
+ * for more details.
+ *
+ * You should have received a copy of the GNU General Public License along
+ * with this program; if not, write to the Free Software Foundation, Inc.,
+ * 59 Temple Place, Suite 330, Boston, MA 02111-1307 USA
+ */
+
+#include "inc/stateestimation.h"
+
+// Private constants
+
+// low pass filter configuration to calculate offset
+// of barometric altitude sensor
+// reasoning: updates at: 10 Hz, tau= 300 s settle time
+// exp(-(1/f) / tau ) ~=~ 0.9997
+#define BARO_OFFSET_LOWPASS_ALPHA 0.9997f
+
+// Private types
+
+// Private variables
+static float baroOffset = 0.0f;
+static bool first_run   = 1;
+
+// Private functions
+
+static int32_t init(void);
+static int32_t filter(stateEstimation *state);
+
+
+void filterBaroInitialize(stateFilter *handle)
+{
+    handle->init   = &init;
+    handle->filter = &filter;
+}
+
+static int32_t init(void)
+{
+    baroOffset = 0.0f;
+    first_run  = 1;
+    return 0;
+}
+
+static int32_t filter(stateEstimation *state)
+{
+    if (first_run) {
+        // Initialize to current altitude reading at initial location
+        if (ISSET(state->updated, bar_UPDATED)) {
+            first_run  = 0;
+            baroOffset = state->bar[0];
+        }
+    } else {
+        // Track barometric altitude offset with a low pass filter
+        // based on GPS altitude if available
+        if (ISSET(state->updated, pos_UPDATED)) {
+            baroOffset = BARO_OFFSET_LOWPASS_ALPHA * baroOffset +
+                         (1.0f - BARO_OFFSET_LOWPASS_ALPHA)
+                         * (-state->pos[2] - state->bar[0]);
+        }
+        // calculate bias corrected altitude
+        if (ISSET(state->updated, bar_UPDATED)) {
+            state->bar[0] -= baroOffset;
+        }
+    }
+
+    return 0;
+}
+
+
+/**
+ * @}
+ * @}
+ */