In this paper, we present a fine-grained localization algorithm for wireless sensor networks using a mobile beacon node. The algorithm is based on distance measurement using RSSI. The beacon node is equipped with a GPS sender and RF (radio frequency) transmitter. Each stationary sensor node is equipped with a RF. The beacon node periodically broadcasts its location information, and stationary sensor nodes perceive their positions as beacon points. A sensor node's location is computed by measuring the distance to the beacon point using RSSI. Our proposed localization scheme is evaluated using OPNET 8.1 and compared with Ssu's and Yu's localization schemes. The results show that our localization scheme outperforms the other two schemes in terms of energy efficiency (overhead) and accuracy. Keywords--Localization Algorithm, Mobile Beacon Node, Sensor Network, RSSI