Abstract: An electromagnetic telemetry system is a real time data transmission system for drill string telemetry, which is detected the electromagnetic signal between the wellhead and dipole on the surface. The well-site noise is an important factor that affect the electromagnetic MWD system transmission performance. An adaptive noise cancellation method was studied to enhance the EM-MWD receiver’s ability to extract very weak signals from large amounts of well site noise. In order to understand the noise characteristics of the well site, the noise characteristics of the well site is described briefly, which is useful to design the LMS algorithm. Then, step-size parameter , is modified based on the noise characteristics of the well site. Experimental results on real-world data and simulation data show that the modified LMS algorithm has faster convergence speed, smaller steady and lower excess mean square error.