Abstract: According to the disadvantages of demodulation in digital automatic gain control loop, which needs multipliers and uses much of the system resource, this paper proposed a new method of digital demodulation by means of absolute values or maximal values of slip windows which can substitute the square operation of signals in analog demodulation method. The new method can reduce, to a large extent, the contradiction between the system velocity and resource. Based on the analysis of the loop, the computer simulations are given. The results indicate the feasibility of digital AGC, and they are highly effective. The method has been used in design of digital AGC of digital intermediate frequency receiver.