The science of system identification is widely utilized in modeling input-output relationships of diverse systems. In this article, we report field programmable gate array (FPGA) based implementation of a real-time system identification algorithm which employs forgetting factors and bias compensation techniques. The FPGA module is employed to estimate the mechanical properties of surfaces of materials at the nano-scale with an atomic force microscope (AFM). The FPGA module is user friendly which can be interfaced with commercially available AFMs. Extensive simulation and experimental results validate the design.