Abstract: Based on the bistatic scattering coefficients deduced from perturbation method and the simulated data of bistatic sea echo spectrum, Howells algorithm is adopted to derive the wave-number spectrum and to extract the information of significant wave height and wind speed. In this paper, the applicable condition of Howells algorithm is complemented. The selection principle of the retained number of singular values of the kernel matrix is determined. Inversion results show that the inversion errors of significant wave height and wind speed decrease as the wind direction tends to perpendicular. And the inversion errors also decrease as the appropriate operating frequency is selected according to the sea state (i.e. wind speed or significant wave height). If the operating frequency and the retained number of singular values of the kernel matrix are appropriate, the inversion error of significant wave height will be less than 3% and the inversion error of wind speed will be less than 1%.