With the development of network applications, routers must support such functions as firewalls, provision of QoS, traffic billing, etc. All these functions need the classification of IP packets, according to how different the packets are processed subsequently, which is determined. In this article, a novel IP classification algorithm is proposed based on the Grid of Tries algorithm. The new algorithm not only eliminates original limitations in the case of multiple fields but also shows better performance in regard to both time and space. It has better overall performance than many other algorithms.