This paper proposes an annotation overlay system for a vehicle in order to give user useful information of user's neighborhood. In a car navigation system which acqiuires the position of a user by global positioning system (GPS), the user can get information of user's neighborhood. However, since the system give the user information merged on a digital map, it is not easy for the user to given information with real objects. We propose an annotation overlay system using augmented reality which can merge a real and virutal worlds. The proposed system presents position-dependent information superimposed on image captured at a user's viewpoint by using a user's position acquired by GPS, velocity sensor and inertial sensor. The feasibility of the annotation overlay system has been successfully demonstrated with experiments.