This paper presents an improved automatic tuning method for stable processes using a modified relay in the presence of static load disturbances and measurement noise. The modified relay consists of a standard relay in series with a PI controller of unity proportional gain. The integral time constant of the PI controller of the modified relay is chosen so as to ensure a minimum loop phase margin of 30( composite function). A limit cycle is then obtained using the modified relay. Hereafter, the PID controller is designed using the limit cycle output data. The derivative time constant is obtained by maintaining the above mentioned loop phase margin. Minimizing the distance of Nyquist curve of the loop transfer function from the imaginary axis of the complex plane gives the proportional gain. The integral time constant of the PID controller is set equal to the integral time constant of the PI controller of the modified relay. The effectiveness of the proposed technique is verified by simulation results.