Loran-C is the most important backup and supplement system for the global navigation satellite system (GNSS). However, existing Loran-C demodulation methods are easily affected by noise and skywave interference (SWI). Therefore, this article proposes a demodulation method based on Loran-C pulse envelope correlation–phase detection (EC–PD), in which EC has two implementation schemes, namely moving average-cross correlation and matched correlation, to reduce the effects of noise and SWI. The mathematical models of the EC, calculation of the signal-to-noise ratio (SNR) gain, and selection of the EC schemes are given. The simulation results show that compared with an existing method, the proposed method has clear advantages: (1) The demodulation SNR threshold under Gaussian channel is only −2 dB, a reduction of 12.5 dB; (2) The probability of the demodulated SNR threshold, being less than zero under the SWI environment, can reach 0.78, a 26-fold increase. The test results show that the average data availability of the proposed method is 3.3 times higher than that of the existing method. Thus, our demodulation method has higher engineering application value. This will improve the performance of the modern Loran-C system, making it a more reliable backup for the GNSS.