This paper addresses the design of an adaptive laser range sensor based terrain following system for unmanned aerial vehicles. In this study we analyze the effect of the aircraft velocity on the terrain following performance and discuss possibilities to improve its accuracy by varying the velocity. First we demonstrate the dependence of the system performance on the flight speed and its relation to the terrain model parameters. Consequently, we introduce a terrain model parameter identification scheme that will be used to determine the preferred aircraft velocity. The resulting optimization problem is solved using data smoothing techniques. The performance of the associated smoother is evaluated for various terrain models and is shown to be feasible and converging to the terrain model for the examined cases.