In today’s era, it is important to analyze and utilize various signals in industrial or laboratory applications. Measured signals provide critical information about the controlled system, which can be contained precisely within a narrow frequency range. Many methods and algorithms exist to process such signals in both the time and frequency domains. In particular, signal processing in the frequency domain is primary in industrial practice because dominant components within a specific narrow frequency band are sought. The discrete Fourier transformation (DFT) algorithm is the tool used in practice to find these frequency components. The DFT algorithm provides the full frequency spectrum with a higher number of calculation steps, and its spectrum frequency resolution is low. Therefore, research has focused on finding a method to achieve high-frequency spectrum resolution. An important factor in selecting the technique was that such an algorithm should be implementable on a microprocessor-based system under harsh industrial conditions. Research results showed that the DFT ZOOM method meets these requirements. The frequency zoom has many advantages but requires some modification. It is implemented in high-performance analyzers, but a thorough and detailed description of the respective algorithm is lacking in technical articles and literature. This article mathematically and theoretically describes the modified frequency zoom algorithm in detail. The steps of the frequency zoom, from creating an analytical signal through frequency shifting and decimation to the frequency analysis of the signal, are realized. The algorithm allows for the analysis of a signal with high-frequency resolution in a limited frequency band. A significant modification of DFT ZOOM is that of using the Hilbert transform to create an analytic signal. This resolves the aliasing issue caused by the overlap between fundamental and sideband spectra. Results from processing deterministic and stochastic signals using the modified DFT ZOOM are presented. The presented experimental results contribute to a more detailed frequency analysis of the signal. As part of this scientific research, the issues of frequency zoom were thoroughly addressed, solving the partial problems of this algorithm, both in theory and in the context of signal theory.