Abstract: Tree height retrieval results making use of polarimetric interferometry SAR data based on ESPRIT algorithm is seriously biased because of the existence of depolarized components. In order to solve this problem, a modified inversion algorithm combining coherence optimization theory and its physical scattering mechanism is presented. Also, a new scattering vector called coherence optimized scattering vector is introduced to help understanding the algorithm. Finally, the proposed and traditional ESPRIT algorithm is applied to simulated L-Band PolInSAR data provided by ESA respectively, and the experiment results suggest the validity of the inversion algorithm.