To solve the problems of poor fixed distance precision and difficult engineering implementation of the pseudorandom frequency hopping fuze, a new signal processing method for the fuze based on signal reconstruction is proposed in this study. First, the transmitted signal is used to generate a set of local reference signals for the matched filter. Then all the local reference signals are applied to coherent integrate with the reflected echo, respectively. Finally, any channel of these correlation peak values exceeding the presupposed threshold can be taken as fixed distance successfully. Furthermore, the relative speed between the missile and target can be approximately estimated by the corresponding channel number. The simulation results show that the method can detect the target precisely, which means that the problem of mismatched filter has been solved. Moreover, the method is easy to be implemented, which can greatly improve real-time property of the fuze, thus it has practical value for engineering application.