Autonomous navigation technology of formation flying satellites is one of the key technologies for formation flying. The objective of this paper is to derive a set of Hill-like equations suited for the tandem formation and investigate the relative state (including relative position, relative velocity and relative attitude) determination of satellites flying in formation based on the relative distance measurements of GPS like sensors. The approach developed here uses two-point measurement of the relative orbit state to establish relative orbit and attitude kinematics and measuring equations, while no velocity measuring available. State estimation is achieved through the extended Kalman filter technology. Simulation results indicate that this approach is simple, effective and suitable for high accuracy relative navigation of formation flying satellites.