Abstract: Telephone networks are an essential part of modern life, the newest version or generation is the broadband integrated services digital network (BISDN). The B-ISDN uses the ATM as a transmission protocol. ATM is a streamlined form of packet switching suitable for high speed networks; it developed as a part of B-ISDN. Its importance grows especially after the introduction of IP over ATM. It is a flexible mode of transfer. It can provide many QoS categories and can work with different rates. Due to the importance of ATM stated above, ATM over satellite has been proposed to address the QoS issues over the satellite links. The ATM over satellite was studied, an error model provided for it, performance of TCP/IP over ATM was discussed, and techniques for improving ATM over satellite were proposed. One of them is to move error control to higher layer and another technique is to change the coder of the ATM header to a coder that detect and correct errors in all of the ATM cell. In this thesis a new technique is produced to work over ATM satellite system. This technique work by grouping some cells, adding header to them, and send the result to a coder. The proposed technique uses selective acknowledgment. To reach real model two steps are taken for each coder size and error behavior the errors behavior that used in analysis are stated. The coder size term is defined. A competition between errors types and coder types is made. For each case an analysis is done to achieve mathematical formulation for these cases. The efficiency for the four cases is drawn. The analysis shows that this technique gives good performance especially at increasing cells number per packet. But real efficiency begins decrease after certain point. In spite of this decrease the value still good because the decreasing is not large.