In this study, improved capacity spectrum method (CSM) is proposed. The method can account for higher mode contribution to the seismic response of MDOF systems. The CSM has been conveniently used for determining maximum roof displacement using both demand spectrum and capacity curve of equivalent SDOF system. Unlike the conventional CSM, the maximum roof displacement is determined without iteration using inelastic displacement ratio and R factor calculated from demand spectrum and capacity curve. Three moment resisting steel frames of 3-, 9- and 20-stories are considered to test the accuracy of the proposed method. Nonlinear response history analysis (NL-RHA) for three frames is also conducted, which is considered as an exact solution. SAC LA 10/50 and 2/50 sets of ground motions are used. Moreover, this study estimates maximum story drift ratios (IDR) using ATC-40 CSM and N2-method and compared with those from the proposed method and NL-RHA. It shows that the proposed CSM estimates the maximum IDR accurately better than the previous methods.