The present invention relates to a method for cancelling adjacent cells interference signal in a wireless communication system. In one embodiment this is accomplished by receiving desired user signal and cancel the channel effect using the desired users reference and or pilot signals, by a serving base station, identifying interference power by estimating the interferer power, determining if the interference is more than threshold, monitoring the interference and identify the interferer signal, re-generating the interference signal source and perform the channel estimate for the interferer, and canceling the interference by applying the interference pattern and the channel estimate to the desired user who's interference is more than threshold.