This paper presents an improved real time target tracking system based on Cam-Shift and advanced Kalman filter algorithms. The paper, proposes a simple low implementation cost scheme while keeping the high tracking performance. Two degrees of freedom target tracking system based on two hybrid stepper motors with their drive systems is fully designed and implemented to improve the tracking accuracy while keeping low-cost. The potential of the proposed algorithm lies in its ability to accurately detect, track and produce firing commands on the designated target while utilizing low cost on the shelf embedded Microcontroller boards. A low cost Universal Serial Port (USB) camera is used and integrated with the proposed algorithm in order to detect and track maneuvering targets. A series of experiments for stationary and moving objects are carried out for testing the proposed system efficiency. The proposed system enables accurate performance for tracking static and moving objects. Hence it provides a simple and low implementation cost scheme for real time object tracking applications.