Postural sway is considered to have two fundamental stochastic components, a slow non-oscillatory component and a faster damped-oscillatory component. The slow component has been shown to account for the majority of sway variance during quiet stance. Postural control is generally viewed as a feedback loop in which sway is detected by sensory systems and appropriate motor commands are generated to stabilize the body's orientation. Whereas the mechanistic source for the damped-oscillatory sway component is most likely feedback control of an inverted pendulum, the underlying basis for the slow component is less clear. We investigated whether the slow process was inside or outside the feedback loop by providing standing subjects with sum-of-sines visual motion. Linear stochastic models were fit to the experimental sway trajectories to determine the stochastic structure of sway as well as the transfer function between visual motion and sway. The results supported a fifth-order stochastic model, consisting of a slow process and two damped-oscillatory components. Importantly, the slow process was determined to be inside the feedback loop. This supports the hypothesis that the slow component is due to errors in state estimation, since state estimation is inside the feedback loop, rather than a moving reference point or an exploratory process outside the feedback loop.