This paper presents the effects of rotor time constant variation and the on-line tuning algorithm of the rotor time constant. If the value of the rotor time constant is set incorrectly, the IFOC (Indirect Field Oriented Control)scheme exhibits deteriorated performance according to the wrong slip command. These variation effects of the rotor time constant are caused by the slip calculator where it is known that the rotor time constant play an important role in the aligned rotor flux. Using the two torque angles (stationary torque angle, rotating torque angle), the variation of the rotor time constant is identified, and the rotor time constant of the controller is tuned to the proper value of the machine. As the result, with the proposed algorithm, the dynamics of the deteriorated IFOC system, where the rotor time constant is varied, is improved. For the purpose of the validity of this proposed algorithm, the computer simulations and the experiments have been performed and the explanation of the results is presented. (author). refs., figs., tab.