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The tags' collision is a common problem in RFID (radio frequency identification) system. The problem has affected the integrity of the data transmission during the process of communication in the RFID system. Based on analysis of the existing anti-collision algorithm, a novel anti-collision algorithm is presented. The new algorithm combines the group dynamic frame slotted Aloha algorithm with code division multiple access technology. The algorithm can effectively reduce the collision probability between tags. Under the same number of tags, the algorithm is effective in reducing the reader recognition time and improve overall system throughput rate.