Real-time knowledge of the slip angle in a vehicle is useful in many active vehicle safety applications, including yaw stability control, rollover prevention and lane departure avoidance. Sensors to measure slip angle, including two antenna GPS systems and optical sensors are too expensive for ordinary automotive applications. This paper develops a real-time algorithm for estimation of slip angle using inexpensive sensors normally available for yaw stability control applications. Compared to previous results on slip angle estimation that have been published in literature, the algorithm utilizes a combination of model-based estimation and kinematics-based estimation and compensates for the presence of variations in tire-road characteristics. The developed algorithm is evaluated through experimental tests on a Volvo XC90 sport utility vehicle. Detailed experimental results show that the developed system can accurately estimate slip angle for a variety of test maneuvers.