Abstract: The partial linear observation model was established by transforming the spacecraft dynamic model error into system error of observation model,and the parameter estimation method of partial linear observation model based on Penalized Least Squares Estimation was deduced,and correlative character of the method was proven.Estimation experiment results prove that partial linear model is close to the true characteristic of the measurement data,and the parameter estimation method approaches to the real state of spacecraft,the precision of orbit determination based on penalized least squares estimation is obviously better than the traditional least squares estimation.