This paper presents a new methodology for realizing a Rice channel in BAN Over-The-Air (OTA) testing using a fading emulator with a dynamic phantom. For the proposed apparatus to be effective, the fading emulator must be provided with an appropriate K-factor that represents the actual propagation environment indoors. Further, an implementation of the Rice channel to the proposed fading emulator in a BAN situation is presented. Thereafter, a calibration method for the fading emulator to adjust the actual K-factor of the on-body Rice channel is advanced. This calibration method is validated by analyzing the variations in the instantaneous K-factor attributed to the arm-swinging motion. Finally, an experiment is conducted for a continuous human walking motion with the fading emulator using an arm-swinging dynamic phantom. The results show that the developed fading emulator allows BAN-OTA testing to replicate the actual Rice channel propagation environment with the consideration of the dynamic characteristics of human walking motion.