This thesis presents a methodology for designing a low-cost attitude and heading estimation system which is composed of three single-axis rate gyros, a tri-axis accelerometer, and a tri-axis magnetometer. Rate gyro sensor we have chosen is a small relatively inexpensive piezoelectric vibrating rate gyro originally developed for the automobile market and active suspension systems by Murata. It generates voltage output proportional to the angular velocity of the vehicle around the principal axis of the device. Accelerometer is a tri-axis digital output linear accelerometer developed by ST that includes a sensing element and an IC interface able to take the information from the sensing element and to provide the measured acceleration signals to the external world through an I2C/SPI interface. Magnetometer is an integrated tri-axis magnetic field sensing module manufactured by PNI. It is used to measure Earth’s magnetic field. SPI interface allows easy access to its measurement parameters and resulting field measurement data. Output signals coming from these sensors are fused through two Kalman filters. One Kalman filter is used to estimate roll and pitch angles and the other is for heading angle estimation. By using this method, we have obtained attitude (roll and pitch angle) and heading information which are reliable over long period of time. Results from a set of simulation works have shown the performance of the presented method.