A method and system to improve the performance of phase correlation motion estimation for low-bit-precision implementation are described herein. Phase correlation uses the Fast Fourier Transform (FFT) with operations with infinite-precision constants. Since physical implementations use finite-precision arithmetic, there is some loss in precision relative to the ideal infinite-precision case. In low-complexity implementations, it is desirable to use as few bits as possible, and if the precision is too low, the performance of traditional phase correlation suffers. A pre-processing technique is applied to the data prior to taking the FFT, which minimizes the negative effects of finite precision in the FFT and allows high quality results from phase correlation. The pre-processing step is a content-dependent contrast adjustment that maps the range of the input images' pixel values to the range of input values for the FFT. There is no post-processing required after the FFT to compensate for the pre-processing step.