With the presently operational altimeter on the U.S. Navy satellite GEOSAT, and three new altimeters soon to be launched by the European, French and U.S. space agencies, satellite altimetry promises to become a standard technique for studying oceanographic variability. Little has been written about the instrumental technique used to determine sea surface height from altimetric measurements. In this paper, we summarize the pulse-compression technique by which a radar altimeter transmits a relatively long pulse and processes the returned signal in a way that is equivalent to transmitting a very short pulse and measuring the time history of the returned power in a sequence of range gates. The effective short pulse enhances the range resolution that would be obtained from the actual long pulse. The method used onboard the satellite to track the point on the returned signal corresponding to the range to mean sea level (spatially averaged over the altimeter footprint) is also summarized. Pulse compression and sea level tracking are important to the overall error budget for altimetric estimates of sea level. The dominant sources of sea level tracking errors are discussed, with particular emphasis on the high degree of accuracy required for the TOPEX altimeter scheduled for launch in mid 1992. Also included here as an appendix is a derivation of the spherical earth correction to altimeter footprint area. It is shown that the flat earth approximation used heretofore in ground-based processing of altimeter data results in a bias of −0.51 dB in estimates of normalized radar cross section from an altitude of 800 km; if not corrected, this bias would increase to −0.83 dB for the TOPEX altitude of 1335 km.