The ME SAT design team at the University of Missouri-Rolla is in the process of developing a pair of microsatellites designed to demonstrate formation flight using low-cost, off-the-shelf technologies. As part of the demonstration, a newly developed nonlinear filter named the "θ- D" filter, is proposed for purposes of orbit determination. This paper describes the general θ-D filter formulation, the dynamic model used for orbit determination, and a method of implementing a continuous filter in a discrete time sense. The results presented within show the effectiveness of the proposed orbit determination method.