Certain aspects of a method and system for optical flow based motion vector estimation for picture rate up-conversion (PRUC) may include generating one or more motion vectors based on extracted picture rate up-conversion (PRUC) data by minimizing a cost function. The cost function may be constrained by any combination of a block matching constraint, a smoothness constraint and a bias constraint. The PRUC data may be extracted from a compressed video data stream while the compressed video data stream is being decompressed by a video decompression engine. The PRUC data may comprise local block motion vectors, block coding modes, quantization levels, quantized residual data and decoded pictures. A plurality of interpolated pictures may be generated based on extracting the PRUC data.