Down-hole oil and gas industry requirements for measuring thermodynamic and geophysical parameters, for instance pressure, temperature, vibration and multiphase flow, are challenging. Accomplishing these necessities requires a complete signal communications chain of high-performance components and effective signal processing communication techniques to provide system reliability. Nevertheless, noise interference, cable attenuation and thermal drift of the front-end passive electronic elements can lead to poor signal-to-noise ratio (SNR) and possibly loss of the communication link. This paper describes a signal processing algorithm implemented in a bidirectional communication system that exchanges data from a down-hole high pressure and high-temperature (HPHT) measurement tool to the surface installation. The communication channel is a multi-conductor coaxial logging cable also used as a power supply transmission line. The instrumentation system consists of a proprietary down-hole measurement tool, composed of an HPHT sensor and a high-temperature digital signal processor (DSP)-based electronic device; located in the surface installation is a data-acquisition equipment. The system employs a signal processing algorithm, based on the frequency domain SNR characterization of the whole communication chain, which determines in real time the optimal carrier frequency that is automatically implemented in the selected modulation/demodulation technique. The obtained laboratory test results of the down-hole tool, using changes in temperature from 25° to 185°C, provide a firm basis for testing and evaluating the system in the field.