This paper presents a work carried out to develop an onboard integrated system for a controlled free running ship model using data acquired from a Motion Reference Unit(MRU). Using the reference data, the system performs processing and control through wireless communication (Wi-Fi). The application of free running model is to investigate the sea keeping and maneuvering characteristics of a ship. In such a scenario there are disturbing external forces and hence a time - position data based closed loop control algorithm is essential. The development provides the nucleus for such a controlled autonomous system. The ship based integrated system consists of azimuth propulsion unit, MRU, central processing unit for control, data link and a battery pack for autonomous operation of the ship model. A proportional controller is used with the feedback from the MRU to perform heading control using azimuth propulsion system. Quality of free running model test is improved with this system as compared to traditional facilities with captive model and follower carriage based system. © 2016 IEEE.