To improve the accuracy in positioning system of low orbit dual-satellite time difference of arrival (TDOA) and frequency difference of arrival (FDOA), an original method based on virtual reference station (VRS) to precisely correct the measured TDOA and FDOA of unknown target is advanced. VRS that doesn′t exist in physic is established nearby the unknown target by the cooperative radiation sources so that the measured TDOA and FDOA of unknown target can be corrected via utilizing the constructed TDOA and FDOA at VRS. Simulation preliminarily analyzes the method performance. It is verified that the precision of constructed virtual TDOA is mo re less than that of FDOA at VRS. Meanwhile the systematic error of unknown target TDOA and FDOA can be reduced by 97% and 95% separately by the proposed method. Moreover, compared with positioning accuracy using uncorrected TDOA and FDOA at unknown target, the positioning accuracy after applying corrected TDOA and FDOA is greatly improved.