Several schemes for gain control are used for preventing saturation of receiver, and overloading of data processor, tracker or display in pulse radars. The use of digital processing techniques open the door to a variety of digital automatic gain control schemes for analyzing digitized return signals and controlling receiver gain only at saturating clutter zones without affecting the detection at other zones. In this paper, we present a novel scheme of Digital Instantaneous Automatic Gain Control (DIAGC) which is based on storing digitally the dwell based clutter returns and deriving the gain control. The returns corresponding to the first two PRTs in a dwell are used to analyze the presence of saturating clutter zones and the depth of saturation. Third PRT onwards proper gain control is applied at the IF stage to prevent saturation of the following stages. FPGA based scheme is used for digital data processing, storing, threshold calculation and gain control generation. The effect of DIAGC on pulse compression is also addressed in this paper.