The new Advanced Video Coding (AVC) standards further exploit temporal correlation between images on a sequence by considering multiple reference frames and variable block sizes. It increases the compression rate for a given video quality at the cost of a significant increase in the computational load. Specialized hardware processors have been proposed to perform real time motion estimation on AVC, but the non-recurring engineering cost of these solutions is too high. This paper proposes a parallel algorithm that exploits the capacity of the current multi-core processors to implement real time motion estimation for AVC. In particular, exploiting the computational capacity and the fast memory system of the heterogeneous multi-core CELL processor, the synergetic processors accelerate the motion estimation while the main processor executes in parallel the other components of the AVC system. Experimental results show that motion estimation can be performed in less than 50ms per frame, for CIF video format, with up to 5 reference frames and variable block sizes, by programming the CELL with the proposed parallel algorithm. In addition, the scalability of the proposed solution is proven regarding the video sequence resolution, the number of cores and reference frames used.