In adaptive control of systems with poles close to the unit circle, application of the recursive estimation techniques can lead to excursions of the poles of the identified model outside the unit circle even when the process is open loop stable These excursions can be of two types. The poles of the deterministic component of the model can drift outside unit circle even when the process has no unstable modes. Alternatively, the poles and/or zeros of the unmeasured disturbance (noise) model can drift outside the unit circle In either case, the identified model is not suitable for on-line controller adaptation In this work, a novel constrained recursive formulation is proposed for on-line parameter estimation based on the pseudo-linear regression (PLR) approach. The efficacy of the proposed approach is demonstrated by conducting experimental studies on a benchmark laboratory scale heater-mixer setup The analysis of the open and closed loop experimental results reveals that the proposed constrained parameter estimation scheme provides a systematic and computationally attractive approach to ensure that the identified model parameters are restricted to the feasible region (C) 2010 Elsevier Ltd All rights reserved.