In this paper, an optimal coning compensation algorithm for strapdown system is proposed by minimizing the coning error. The proposed algorithm is derived as a generalized form in that it contains the class of the existing coning algorithms and allows the design of optimal algorithm for various combinations of gyro samples. It is shown the magnitude of resulting algorithm errors depends mainly on the total number of gyro samples including present and previous gyro samples. Based on the results, the proposed algorithm enables the algorithm designers to develop the effective coning compensation algorithm according to their attitude computation specifications with ease. In addition, the multirate method which can efficiently implement the algorithm is presented.