We propose a novel particle filter-based motion compensation strategy for video coding. We use a higher order linear model in place of the traditional translational model used in standards such as H.264. The measurement/observation process in the particle filter is a computationally efficient mechanism as opposed to traditional search methods. We use a multi-resolution framework for efficient parameter estimation. Results of our experimentation show reduced residual energy and better PSNR as compared to traditional video coding methods, especially in regions of complex motion such as zooming and rotation. © 2010 ACM.