Variable parametric projection filter (VPPF) is proposed as inverse analysis procedure to identify structural damage. Parametric projection filter has known as one of effective filters in parallel with Wiener filter and projection filter. As the characteristics of the parametric projection filter, the regular parameter to assure the stable filtering process is including. The regular parameter has been given as a voluntary value corresponding to each inverse problem in the existing analysis concerned with inverse problem using filtering algorithm based on parametric projection filter. In this study, the procedure to give the regular parameter computationally in each filtering step is shown instead of a voluntary value. As examples of inverse analysis using the VPPF, structural damage analysis based on system identification was performed for a 3-story frame structure model. Effectiveness of the VPPF is shown though some numerical calculations.