In this study, a new automated noise rejection algorithm, the SOurce-estimate-Utilizing Noise-Discarding algorithm (SOUND), was evaluated on magnetoencephalographic (MEG) resting-state signals in order to select its optimal configuration parameters. Different values of the epoch length and the regularization parameter λ0 were assessed in three scenarios with ascending noise levels. Results show that it is possible to remarkably improve the Signal-to-Noise Ratio, without overly altering the signal of interest. An optimal λ0 value of 0.1 was obtained. However, the epoch length should be adapted to the specific problem. In conclusion, our results suggest that the SOUND algorithm is an appropriate and useful tool to be applied in a preprocessing pipeline for MEG restingstate signals.