In active sonar systems, the target echoes are usually equivalent to a superposition of the Doppler-scaled reflections from multiple highlights. The reflections overlap with each other both in the time and frequency domain, which results in a decreased velocity estimation performance. Recently, the hyperbolic-frequency modulated signal has been widely employed in sonar systems for moving targets due to its Doppler tolerance, while the precise velocity estimation becomes a great challenge under such conditions. In this paper, the echo c is modeled onsidering a target with a constant velocity and multi-highlights. The velocity estimation performance is analyzed though the signal’s matched filter and the wideband ambiguity function. An improved method based on the sliding window matching algorithm is proposed to improve the performance. The method controls the energy of environmental noise and interference by focusing on the dominant target highlight, and applying a designed window which utilizes the Doppler characteristics of hyperbolic-frequency modulated signals. Simulations and lake experiment allow us to compare between the improved method and the conventional matched filter method. The results verify the influence of the multi-highlights in velocity estimation and indicate that the improved method has more effective performance.