Parameter modification of a linear finite element model (FEM) based on a modal sensitivity matrix is usually performed through an effort to match FEM modal data to experimental ones. However, there are cases where this method cannot be applied. successfully; lack of reliable modal data and ill-conditioning of the modal sensitivity matrix constitute such cases. In this research, a novel concept of introducing feedback loops to the conventional modal test setup is proposed. This method uses closed-loop natural frequency data for parameter modification to overcome the problems associated with the conventional method based on modal sensitivity matrix. The feedback loop changes the modal characteristics of the system, and the closed-loop natural frequencies can be used as additional information to solve the problem caused by lack of reliable modal data. Through proper selection of exciter and sensor locations and associated feedback gains, the condition number of the modal sensitivity matrix can be reduced, and a more reliable estimation result can be expected. A parameter modification scheme based on the closed-loop natural frequency data along with the modal sensitivity modification and controller design method is explained. Proposed controller design method is efficient in changing modes. Numerical simulation of parameter estimation based on time-domain input/output data is provided to demonstrate the estimation performance of proposed method.