In this paper, we have presented how the capacity of cellular system can be enhanced by using Space Division Multiple Access (SDMA) with directive antenna in mobile communication systems. One of the biggest draw back of wireless environment is the limited bandwidth. However, the users sharing this limited bandwidth have been increased considerably. SDMA is a technology by which the capacity of the existing mobile communication system can economically be increased. Adaptive Antenna provides a spot beam for each users in the cells as it moves. This paper analysis the comparison of average Bit Error Rate (BER) of SDMA and Code Division Multiple Access (CDMA) technique and the way in which SDMA can be introduced to increase the capacity of a cellular system in Frequency Selective Multipath Rayleigh Fading Channel. The BER is found for a standard omni directional base station antenna, and the another set of curve is found for flat top beam having a directivity of 8 dB. We see that SDMA offers improved capacity in wireless communication system.