Abstract-Fast and optimal motion estimation method is proposed for electronic image stabilization. First, an approach for macro-block judgment is presented. Before motion vectors calculation, gradient information is analyzed, only useful reference blocks that are indispensable for accurate motion estimation are selected, by which the number of macro-blocks for subsequent calculation is reduced. Second, in the block matching, an improved SSDA is used to reduce computing cost. Finally, the affine transformation model and similarity transformation model of image motion are created and using least squares method for solving the optimal estimation of model parameters. Experimental results show the accuracy and fast computing speed of the proposed method.