Abstract— Scalable network localization is key for realizing ad-hoc networks. In this paper we propose a localization scheme where nodes form a relative coordinate system of the network in a distributed manner. Each node in the adhoc network is capable of estimating both the range and orientation of its 1-hop neighbors. The proposed localization scheme then achieves a relative coordinate system for any topology as long as the underlying graph is connected, irrespective of the node density. We evaluate the performace of the proposed scheme and show with simulations that it is more scalable than a similar localization scheme that uses triangulation. We also present propagation of localization error in the network due to estimation errors in both the range and the orientation. We also discuss how this scheme can be implemented using optical wireless technology.