A major requirement for providing Internet connectivity to mobile handhelds is the wireless network access for handheld devices. As an alternative to the expensive 3G networks, which share 2 Mbps in several square kilometers, the use of short-range wireless technologies like Bluetooth that shares 1 Mbps among just 7 users, has been proposed. This is much more economical as it works in the unlicensed band and leverages the existing wired broadband infrastructure. In such a Bluetooth network, the mobiles will frequently move out from the range of one access point into that of another, requiring seamless handoff. We discuss a new algorithm to support fast handoff at the wireless layer. Our method exploits the continuity of the user’s path and existing connection information at the older access point to reduce the handoff delay. It inter-works with IP micromobility protocols, such as Cellular IP, for managing other mobility related issues at layer 3. Simulations reveal that our proposed method reduces the handoff delay by more than an order of magnitude and significantly enhances the bandwidth utilization.