SummaryThe near‐field electromagnetic ranging technology exploits the near‐field behavior of radio signals to measure distance in indoor real‐time location system. In this paper, we propose a new adaptive time‐delay estimation algorithm based on maximum correntropy criterion (MCC) and received signal strength indication (RSSI), abbreviated as RSSIMCC. The proposed RSSIMCC algorithm estimates the time delay between the electric and magnetic components of low‐frequency signals in the near field instead of detecting the phase difference. An inaccurate time‐delay estimation value obtained according to the RSSI is used as the initial time delay of adaptive time‐delay estimator, which is not far from the true time delay and can improve the convergence speed. Through the analysis of simulation and experiment results, we conclude that the proposed RSSIMCC algorithm can estimate the time delay with small steady‐state error in near‐field electromagnetic ranging application. Then the time delay estimated by RSSIMCC algorithm can be exploited based on the near‐field behavior of radio signals for ranging in an indoor environment. Copyright © 2016 John Wiley & Sons, Ltd.