Terminal guided projectile has been widely used in various countries because of its low cost and high hit accuracy. In this paper, the model of the dual-channel overload autopilot with pseudo-angle of attack (PAA) feedback for the terminal guidance projectile is established with and without the guidance disturbance signal. Besides the necessary and sufficient conditions for the dynamic stability of the projectile are derived. Subsequently, the validity of the derived stability conditions is verified by simulation, the stability regions of terminal guided projectiles in two cases are given, and the influence of the guidance disturbance signal on the stability region of the autopilot parameters is analyzed. Finally, the influence of altitude on the stability of the overload autopilot with PAA feedback for the terminal guided projectile is investigated, and the stability regions of terminal guided projectiles at different altitudes are given. The simulation results illustrate that the increase of altitude will have an adverse effect on the stability of the terminal guided projectiles.