The time varying envelope of the received signal, for the case when a Line of Sight (LoS) component exists between the transmitter and the receiver, is described by a Rician distribution with Rician factor K. The Rician factor is a measure of the severity of the fading, with K = 0 being the most severe Rayleigh fading, and K = ∞ representing essentially a non-fading channel. K factor estimation is often thus required for link budget calculation as well as to determine the best possible space - time precoder when multiple transmit antennas are used. Here, we discuss the Maximum Likelihood Estimator (MLE) and a moment based estimator for the estimation of the K factor. The James - Stein Estimator (JSE), which is a biased, non - linear estimator, is then used to estimate the K factor and its performance is compared with the MLE. It is shown that using biased estimators (such as the JSE) for K factor estimation, can significantly improve the estimation performance. At low and high K factors, the JSE is similar to MLE, whereas for medium values of K, the JSE can outperform MLE significantly. © 2007 IEEE.