Interpolation algorithms are usually used to estimate the channel frequency response value at the data location in Long Term Evolution-Advanced (LTE-A) system. Concerning the problem that traditional Linear Minimum Mean Square Error (LMMSE) algorithm needs to obtain channel statistical properties in advance and it suffers from a high computational complexity due to an inversion matrix operation, an improved LMMSE channel estimation interpolation algorithm was proposed. Firstly, the pilots were interpolated to add virtual pilots, which improved the performance of the algorithm. Secondly, an approximate estimation method of autocorrelation matrix and Signal-to-Noise Ratio (SNR) was given by using the fact that channel energy in the time domain is more concentrated. Finally, a sliding window method was adopted to further simplify the algorithm complexity to complete the LMMSE interpolation in frequency domain. The simulation results show that the overall performance of the proposed algorithm is better than that of linear interpolation method and Discrete Fourier Transform (DFT) interpolation method, and it has similar Bit Error Rate (BER) and Mean Squared Error (MSE) performance with the traditional LMMSE interpolation algorithm. Furthermore, it reduces the complexity by 98.67% compared with traditional LMMSE estimator without degrading the overall BER and MSE performance, so it is suitable for practical engineering applications.