M- ary spread spectrum technique has been used in many communication systems, including the satellite communication system. Its spread and despread spectrum process is complex, and needs more orthogonal PN codes and more complicated computation. A new M- ary spread spectrum scheme is proposed in this paper. At the transmitter, M PN codes of each user are generated by circularly shifting the prototype spreading code. The proposed receiver can realize despreading with a time-frequency transform domain matched -filter, which reduces computation and PN codes selection difficulty of M- ary spread spectrum system. The performances of the proposed system are discussed and analyzed.