Microwave technology serves as a pivotal technique for achieving high-precision measurement of rotating blade tip clearance (BTC). However, in 120 GHz microwave measurement systems, amplitude modulation, DC offsets, and amplitude-phase imbalance introduced by hardware imperfections and clutter reflections cause distortion of echo signals; Moreover, conventional static calibration methods are difficult to adapt to dynamic operating conditions, making integrated calibration and measurement challenging; Furthermore, phase-difference-based ranging methods are limited by the half-wavelength constraint of radio-frequency signals, resulting in a restricted measurement range. To address these issues, a signal calibration and beyond-half-wavelength BTC measurement method for rotating conditions is proposed. A dynamic calibration method based on robust segmented fitting and K-nearest-neighbor (K-NN) parameter estimation is developed to compensate signal distortions online during blade rotation. Second, to overcome the problem of phase wrapping and jumping in beyond-half-wavelength measurements, a phase accumulation correction strategy based on De Moivre′s formula is proposed, enabling continuous displacement demodulation beyond the half-wavelength limit through phase alignment and fine compensation of BTC interval signals. Experimental results show that, with laser sensor measurements as references, the average absolute errors of microwave BTC measurement are 1.611 and 1.563 μm for rectangular and curved blades, respectively, and the maximum repeatability errors are 0.623 and 0.481 μm. In a 5 mm beyond-half-wavelength continuous measurement experiment, the average demodulation linearity of 12 blades reaches 99.932%. The results demonstrate the accuracy and robustness of the proposed method for dynamic BTC measurement.