Spatial differencing technique is presented for direction finding in the presence of coherent sources with a uniform linear array.This method fully utilizes the Toeplitz and non-Toeplitz parts of the correlation matrix of received signals.A common algorithm can find the directions of uncorrelated and correlated sources.The spatial differencing algorithm can obtain the directions of correlated and coherent sources. In addition
more sources can be estimated with fewer sensors. And further the spatial differencing technique is supported by the simulations.