In this study, we proposed an adaptive feedback cancellation algorithm for multi-band digital healing aids. The adaptive feedback canceller (AFC) is composed of an adaptive notch filter (ANF) for feedback detection and an NLMS (normalized least mean square) adaptive filter for feedback cancellation. The proposed feedback cancellation algorithm is combined with a multi-band hearing aid algorithm which employs the MDCT (modified discrete cosine transform) filter bank for the frequency-dependent compensation of hearing losses. The proposed algorithm together with the MDCT-based multi-channel hearing aid algorithm has been evaluated via computer simulations and it has also been implemented on a commercialized DSP board for real-time verifications.