People can learn to control EEG features consisting of sensorimotor rhythm amplitudes and can use this control to move a cursor in one or two dimensions to a target on a screen. Cursor movement depends on the estimate of the amplitudes of sensorimotor rhythms. Autoregressive models are often used to provide these estimates. The order of the autoregressive model has varied widely among studies. Through analyses of both simulated and actual EEG data, the present study examines the effects of model order on sensorimotor rhythm measurements and BCI performance. The results show that resolution of lower frequency signals requires higher model orders and that this requirement reflects the temporal span of the model coefficients. This is true for both simulated EEG data and actual EEG data during brain-computer interface (BCI) operation. Increasing model order, and decimating the signal were similarly effective in increasing spectral resolution. Furthermore, for BCI control of two-dimensional cursor movement, higher model orders produced better performance in each dimension and greater independence between horizontal and vertical movements. In sum, these results show that autoregressive model order selection is an important determinant of BCI performance and should be based on criteria that reflect system performance.