In this study, a novel RSSI based parameter tracking strategy for constrained position localization is proposed. We construct the channel model to estimate the distance from the RSSI value. To track the variation of channel parameters, a novel tracking strategy with grid correction is developed to obtain the actual parameters in the monitored indoor region. We observe the convergence of the algorithm and analyzed the impact of the noise to the localization error.The simulation results show the good behavior of our algorithm in presence of space-time variations of the propagation channel.