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Vehicle velocity estimation is an important aspect of intelligent transportation systems. Normally velocity is estimated using dedicated laser speed traps and Doppler radars. Recently, the use of cameras is becoming more common for the purpose of traffic surveillance and smart surveillance system. It is thus the aim of this paper to propose a method for vehicle speed estimation using these existing video cameras. In this paper, we propose a vehicle speed estimation method from video analysis. The method proposed contains several steps; image preprocessing, centroid extraction and tracking. The proposed method transforms the 2D image points into a 3D virtual world to obtain actual vehicle position in 3D space. This is to account for perspective distortion commonly seen in images. Using these 3D points and measuring the time for displacement, the vehicle speed is obtained. Experimental results have shown that the proposed method gives accurate velocity estimation.