Narrowband interference (NBI) is familiar in satellite DS/CDMA systems. Frequency domain notch filter (FDNF) based on FFT was popular due to its fast arithmetic and absence of convergence time and recursive algorithm. However, at low jammer-to-signal (JSR), the bit error rate (BER) performance degrades dramatically in comparison with the matched filter (MF) receiver of the system self. In this paper, a switching metric named compression gain (CG) was introduced to force FDNF active only after certain interference power level and MF receiver active at lower JSR. By use of CG switching metric, the algorithm overcomes the threshold effect of traditional FDNF. The advantages of the improved FDNF (IFDNF) are low computational complexity and expandability due to that the decision of the domain to be used is made before the interference suppression and the inverse transform. The IFDNF based on CG metric offers better BER performance than original FDNF at lower JSR, and also outperforms the MF receiver at higher JSR. Numerical simulation results show the proposed IFDNF overcomes the threshold effect flaw and also verify the validity of the CG parameter as a switching metric.