To address the tag collision problem in Radio Frequency Identification (RFID) system, an improved binarytree anticollision algorithm was proposed. By dividing the tags into different subsets and adjusting dynamically the process of collision detection, the collision probabilities and power consumption were reduced. The simulation results have shown that, compared with other binarytree anticollision algorithms, the proposed algorithm enhances the identifying efficiency, and both the number of searching times and the bits transferred between the reader and the tags are relatively low when the number of tags is large.