The problem of tracking changes in viscoelastic properties of the systemic arterial bed is considered and a recursive estimation procedure, belonging to the class of output-error algorithms with adjustable compensator, is developed and discussed. By means of computer simulations, suitable values are determined for the key design variable which controls the tradeoff between tracking ability and noise sensitivity of the algorithm. In this way, the algorithm allows on-line estimation of arterial compliance, peripheral resistance, and characteristic impedance on the basis of aortic pressure and flow signals. Furthermore, the results obtained from data numerically simulated, as well as measured on a mock circulatory system, demonstrate that the dominant arterial time-constant can be tracked by the algorithm using only measurements of the aortic pressure during diastole.