A system and method is provided for determining a lateral velocity and a longitudinal velocity of a vehicle equipped. The vehicle includes only one antenna for a GPS receiver and a magnetic compass. A magnitude of a velocity vector of the vehicle is determined. A course angle with respect to a fixed reference using the single antenna GPS receiver is determined. A yaw angle of the vehicle is measured with respect to the fixed reference using a magnetic compass. A side slip angle is calculated as a function of the course angle and the yaw angle. The lateral velocity and longitudinal velocity is determined as a function of the magnitude of the velocity vector and the side slip angle.