In polyolefin processes the melt index (MI) is the most important control variable indicating product quality. Because of the difficulty in the on-line measurement of MI, a lot of MI estimation and correlation methods have been proposed. In this work a new dynamic MI estimation scheme is developed based on system identification techniques. The empirical MI estimation equation proposed in the present study is derived from the 1st-order dynamic models. Effectiveness of the present estimation scheme was illustrated by numerical simulations based on plant operation data including grade change operations in high density polyethylene (HDPE) processes. From the comparisons with other estimation methods it was found that the proposed estimation scheme showed better performance in MI predictions. The virtual sensor model developed based on the estimation scheme was combined with the virtual on-line analyzer (VOA) to give a quality control system to be implemented in the actual HDPE plant. From the application of the present control system, significant reduction of transition time and the amount of off-spec during grade changes was achieved.