Contrasting the dilemma that the traditional time-domain least mean square (LMS) algorithm in the existing satellite navigation receiver anti-interference system cannot satisfy the convergence time is short and maintain a low level of steady-state error at the same time, an inverse cosine variable step size LMS algorithm (ICVS-LMS) is proposed. To begin with, the LMS algorithm, with a fixed step size focuses on its effectiveness in attenuating and suppressing interference signals, is analyzed, and then the proposed ICVS-LMS algorithm is analyzed. In conclusion, both the ICVS-LMS algorithm and the traditional algorithm are simulated and compared in terms of their effectiveness in suppressing interference in satellite navigation signals. The experimental results demonstrate that the improved algorithm significantly reduces convergence time while maintaining a small steady-state error. The improved algorithm demonstrates high robustness and an obvious suppression effect on interference signals. The anti-interference performance is 8.41–12.22% higher than that of the proposed algorithm.