The invention relates to a receiver, and a method for estimating received power in a cellular radio system comprising in each cell at least one base station (BTS1, BTS2) communicating with mobile stations (MS) within its coverage area, in which system mobile stations measure strength of the signal received from the base station, and report the measurement results to the base station. To improve power adjustment, a model describing the dynamic behaviour of the signal is created for the received power on each connection, said model being utilized for power adjustment as well as for taking handover decisions.