The passive detection of low-altitude signal sources is studied using an improved cross-correlation method in the time–frequency domain. A matching template is designed for signal cross-correlation, and a cross-correlation threshold is used to determine whether a signal source is present or not. An improved cross-correlation method is also proposed to estimate the direction of arrival and communication frequency of a signal source. Furthermore, the distance and signal-to-noise ratio are estimated using an energy detector. Outdoor data from a bridge in the Jimo District, Qingdao, and indoor data from a research laboratory are used for performance evaluation. The results obtained show that the proposed method can provide better passive detection of low-altitude signal sources compared to several well-known algorithms in the literature. In addition, this method is more suitable for long-distance detection.