The problems encountered in the application of tilt derivative method to aeromagnetic data processing have been analyzed in this paper. Influenced by the shallow-source interference field, the shape of the aeromagnetic data anomaly processed by the tilt derivative method is complex. An improved method that combines the upward continuation with tilt derivative is therefore put forward in this paper. With practical examples, this paper deals with the problems that are worthy of attention in the application of tilt derivative method to aeromagnetic data processing. The improved method can fully manifest the advantages of the aeromagnetic data in the aspect of geological data interpretation.