In this paper, we investigate the accuracy performance of the OFDM (Orthogonal Frequency Division Multiplexing) based ranging technique. First, we suggest a precise ranging signal model of OFDM modulation. This precise model helps to optimize OFDM signal suitable for range measurement. We further analyze its phase estimation error, which can be converted to a ranging accuracy error using the Cramer-Rao bound (CRB). This study shows that the block size of OFDM signal determines the accuracy of the OFDM-based ranging method.