A filter-bank-based narrowband interference detection and suppression method is developed and its performance is studied in a spread spectrum system. The use of an efficient, complex, critically decimated perfect reconstruction filter bank with a highly selective subband filter prototype, in combination with a newly developed excision algorithm, offers a solution with efficient implementation and performance close to the theoretical limit derived as a function of the filter bank stopband attenuation. Also methods to cope with the transient effects in case of frequency hopping interference are developed and the resulting performance shows only minor degradation in comparison to the stationary case.