Large mutual capacitance touch screen panels (TSP) are susceptible to display and ambient noise. This paper presents a multi-touch detection algorithm using an efficient noise compensation technique for large mutual capacitance TSPs. The sources of noise are presented and analyzed. The algorithm includes the steps to overcome each source of noise. The algorithm begins with a calibration technique to overcome the TSP mutual capacitance variation. The algorithm also overcomes the shadow effect of a hand close to TSP and mutual capacitance variation by dynamic threshold calculations. Time and space filters are also used to filter out ambient noise. The experimental results were used to determine the system parameters to achieve the best performance.