A new algorithm is developed for simultaneous state/parameter estimation for use in real-time flood forecasting applications. Dubbed the Partitioned State/Parameter (PSP) algorithm, it is unusual in the way that the parameter filter is formulated explicitly in terms of the identifiable parameters in the transition and input coefficient matrices. By virtue of its parallel filter structure the algorithm is very fast yet it has been designed so that essential error interactions between the forecasting and parameter filters are preserved. PSP is structured so that input coefficients are only updated when the corresponding inputs are actually applied. This feature is useful for systems subject to sporadic inputs.