In this paper, we propose an enhanced channel estimation method for multi-user multiple-input multiple output (MU-MIMO) based long term evolution (LTE)-Advanced system. In MU-MIMO based LTE-Advanced system, the orthogonality between co-scheduled layers is not perfectly guaranteed. In this case, significant performance degradation in channel estimation can occur due to the interference from transmit signals for co-scheduled users. To overcome this problem, the proposed method partially estimates and eliminates the multi-user interference using a simple pilot matrix inversion based scheme. After the interference mitigation, we apply an iterative two-dimensional minimum mean squared error (2-D MMSE) channel estimation scheme with adaptive noise and interference weighting method to increase the estimation accuracy. Various simulation results verify that the proposed method has superior performance compared with the conventional 2-D MMSE channel estimation scheme, with only a few times of iteration.