A system consisting of three bottom‐moored 12 000‐Hz CW beacons, each separated in frequency by 40 Hz, and separated in space by about 8 km, has been used to track the motion of ship‐suspended, ship‐mounted, sonobuoy‐deployed, and bottom‐moored hydrophones to an accuracy of 4 cm. The system uses Doppler tracking of the beacon signals to provide real‐time estimation of hydrophone velocity and displacement. Factors that might compromise system performance, such as surface, bottom or forward volume scattering, or multipath effects, were found to be negligible. Random phase fluctuations in beacon signals due to these phenomena are small compared with those due to hydrophone motion. Two tests of the system, near Eleuthera Island and near Bermuda, were made in September–October 1972. [This work was performed under U.S. Office of Naval Research Contract No. N00014‐72‐C‐0205.].