MIMO technology proposed in recent years can effectively combat the multipath fading of wireless channel and can considerably enlarge the channel capacity, which has been investigated widely by researchers. However, its performance analysis over correlated block-fading Rayleigh channel is still an open and challenging objective. In this article, an analytic expression of bit error rate (BER) is presented for multiple phase shift keying (MPSK) space-time code, with differential detection over correlated block-fading Rayleigh channel. Through theoretical analysis of BER, it can be found that the differential space-time scheme without the need for channel state information (CSI) at receiver achieves distinct performance gain compared with the traditional nonspace-time system. And then, the system simulation is complimented to verify the above result, showing that the diversity system based on the differential space-time block coding (DSTBC) outperforms the traditional nonspace- time system with diversity gain in terms of BER. Furthermore, the numerical results also demonstrate that the error floor of the differential space-time system is much lower than that of the differential nonspace-time system.