In this paper, a channel adaptive FEC algorithm is proposed which balances the trade-off between the QoS of video transmission and the bandwidth utilization ratio in wireless IP networks. Our algorithm can dynamically adjust to a suboptimal number of FEC redundant packets to cater to the time-varying wireless channel. For the sake of obtaining the suboptimal amount of FEC redundant packets, we derive two analytical models, one is the playable frame rate in MPEG video stream, another is the effective utilization ratio of FEC. Based on these analytical models, a suboptimal value of redundant packets, which makes both the quality of video stream and the effective utilization ratio of FEC approximate their maximum, is calculated by predicting the quality of video stream and effective utilization ratio of FEC under different network conditions (characterized by packet loss probability in this paper). The simulation results indicate that the QoS of wireless video transmission and the bandwidth utilization ratio are improved by employing the proposed algorithm.