A range resolution of ± 2.5 mm has been obtained with a FMCW radar and a sophisticated signal processing. The system operates at X-band with 1.5 GHz frequency sweep. It makes use of the fact, that the total phase length ΔΦ of the IF waveform produced by superposition of the transmitted and reflected FMCW signal is an exact measure of the distance, if reflections of only one target are present. The measurement of the total phase length is performed by counting the zeros of m subsequent IF pulses, while the start phase of each pulse is changed in steps of 2/πm. This procedure results in an accuracy of the ΔΦ measurement ≤ 2π/m. The signal processing is realized by a combination of a single-sideband mixer and a low frequency modulator followed by digital electronics.