Model updating techniques are used to update the finite element model of a structure so that updated model predicts the dynamics of a structure more accurately. The application of such an updated model in dynamic design demands that it also predicts the effects of structural modifications with a reasonable accuracy. Most of the model updating techniques neglect damping and so these updated models cannot be used for accurate prediction of complex frequency response functions (FRFs) and complex mode shapes. This paper deals with the basic formulation for the complex parameter based updating method and its use for dynamic design. A case involving actual measured data for the case of F-shaped test structure, which resembles the skeleton of a drilling machine is used to evaluate the effectiveness of complex parameter based updating method for accurate prediction of the complex FRFs. Structural modifications in terms of mass and beam modifications are introduced to evaluate the complex parameter based damped updated model for its usefulness in dynamic design. © 2009 Elsevier Ltd. All rights reserved.