A novel sensing algorithm for non-volatile Spin-Transfer Torque Magneto-resistive Random Access Memory (STT-MRAM) is presented. The dynamic reference sense amplifier (DRSA) improves sensing margin to achieve high reliability and sensitivity by increasing the difference of input voltages of sense amplifier. A dynamic reference sensing algorithm is proposed as a solution for the read margin loss due to variation in magnetic tunneling junction (MTJ) parameters of the STT-MRAM. The proposed sensing method was designed in standard 0.18um process parameters, and simulation results indicate simultaneously increased the read margin compared with the conventional sensing method.