As a part of the ongoing studies for methods to improve signal processing capabilities for mosaic infrared sensor systems, many algorithms for filtering or separating background points from target points have been developed, namely n-order differencing and spatial filters. The need for improved background rejection performance has resulted in several recent innovative approaches, including the template filter algorithm. This paper evaluates the abilities of the template filter algorithm to further eliminate false track points using n-order temporal differencing as an integral part of its logic design for the case of an event of interest with changing velocity. In other words, it evaluates the algorithm's contributions to increased background and noise rejection capability and speed of processing which are very important to today's real-time signal processing systems. Section 1 of the paper gives an introduction and summary of the analysis results. Section 2 covers the logic of the template filter algorithm and the factors affecting its performance. Section 3 gives some of the results of the algorithm evaluation, and Section 4 takes a look at future considerations and implementations or modifications to the algorithm.