This paper presents the local correlation method of low-SNR (Signal to Noise Ratio) and strongly RFI (Radio Frequency Interference) contaminated DOR (differential one-way ranging) signals with China’s lunar spacecraft. Unlike the Very Long Baseline Interferometry (VLBI) FX correlator used in China VLBI net, the core of local correlation is to construct the received signal model based on the intrinsic characteristics of DOR signals, then extract the residual frequency and phase relative to the model. The performance of the method is verified by means of orbit determination and post-fit residuals analysis. The RMS (root-mean-square) of Delta-DOR delay after orbit determination are 3.7 ns and 0.83 ns when tones SNR varied of 1 dBHz ∼ 20 dBHz and 14 dBHz ∼ 26 dBHz in two individual experiments. The computed standard deviation of post-fit delay residuals is compatible at 3 sigma level with the theoretical spacecraft thermal noise. Local correlation provides a solution to the special RFI contaminated DOR signals process. The precision of Delta-DOR delay with strong RFI keeps the same level of that without interference.