Abstract. Linear rank-width is a linearized variation of rank-width, and it is deeply related to matroid path-width. In this paper, we show that the linear rank-width of every n-vertex distance-hereditary graph, equivalently a graph of rank-width at most 1, can be computed in time Opn 2¨l og 2 nq, and a linear layout witnessing the linear rank-width can be computed with the same time complexity. As a corollary, we show that the path-width of every n-element matroid of branch-width at most 2 can be computed in time Opn 2¨l og 2 nq, provided that the matroid is given by its binary representation.To establish this result, we present a characterization of the linear rankwidth of distance-hereditary graphs in terms of their canonical split decompositions. This characterization is similar to the known characterization of the path-width of forests given by Ellis, Sudborough, and Turner [The vertex separation and search number of a graph. Inf. Comput., 113(1): 1994]. However, different from forests, it is non-trivial to relate substructures of the canonical split decomposition of a graph with some substructures of the given graph. We introduce a notion of 'limbs' of canonical split decompositions, which correspond to certain vertex-minors of the original graph, for the right characterization.