A global positioning system (GPS) receiver is an important sensor used in modern farming, particularly in precision agriculture to determine geographic location and ground speed. The aim of this study was to investigate the effectiveness of two low-cost GPS receivers for measuring ground speed under varying speed conditions on four different dates. A rotary shaft encoder on an auxiliary wheel mounted on an agricultural tractor was used as a reference. A significant time lag between the rotary encoder speed and the GPS speed was found over a range of speeds. It was observed that the GPS speed lagged the encoder speed in both increasing and decreasing speeds. The average time lag was found to be between 3.6 and 5.2 s for Receiver 1 while Receiver 2 had a time lag from 1.7 to 2.5 s. A significant difference was found between the two receivers for increasing and decreasing speeds in terms of time lags (P < 0.05). A post correction by shifting the GPS speed increased the accuracy of the speed measurement capability of both receivers resulting in an average correlation coefficient of 0.30–0.90 for Receiver 1 and 0.65–0.98 for Receiver 2. Effect of USB-to-COM converter was also studied and it did not have a significant effect on time delay. The GPS receivers provided reliable data during constant speed operating conditions; however, caution should be exercised in varying speed conditions when using low-cost GPS receivers. Also, the companies that produce GPS-based speed sensors should supply technical specifications related to velocity estimates during acceleration and deceleration.