A novel application-specific communications scheme for RF-based indoor wireless localization networks is proposed. In such a system wireless badges, attached to people or objects, report positions to wireless router units. Badges have very limited communication, energy, and processing capabilities. Routers are responsible for propagating collected badge information hop-by-hop toward one central unit of the system and are significantly less constrained by battery than the badges. Each unit can radiate a special sequence of bits at selected frequencies, so that any router in the wireless neighborhood can sense, store, aggregate and forward Received Signal Strength Indicator (RSSI) information. Once the central unit receives RSSI from routers, it calculates the overall relative position of each unit in the system. This new scheme has been developed based on the Chipcon CC1010 Evaluation Module with limited communication capabilities. The implemented protocol rules allow scalability of numerous system parameters. The feasibility of the proposed protocol is simulated on a typical floor: 2-dimensional topology where routers are deployed in a grid fashion. Results show that assuming normal operation and a maximum of thousand badges the system can periodically report about every five seconds. Different scenarios are compared, and the proposed scheme is demonstrated to meet strict reliability requirements while providing energy-efficient badges and an acceptable level of latency.