Hidden node problem is an important factor in performance degradation of IEEE 802.15.4 protocol. This paper presents a resolution strategy of hidden collision based on collision indication and grouping. The new strategy, named Hidden Node Collision Detection and Avoidance Strategy (HNCDAS), uses grouping method to divide the CFP of IEEE 802.15.4 protocol into several equal slot cycles and extract the hidden node address information from some damaged frame caused by the hidden conflict. The strategy dynamically adjusts nodes to different competition groups based on currently obtained hidden relationship. The nodes within competitive groups still competitively send messages in accordance with the binary back method in the same period, while different competitive groups send messages in different time slots. As a result, the strategy completely solves the hidden conflict problem. Compared with other hidden node collision resolution strategies, HNCDAS has certain advantages such as less overhead and dynamic adjustment capability. The convergence of the strategy and the maximum time of resolution strategies are also demonstrated in theory. Experimental results show that HNCDAS can significantly improve data transmission rate, throughput and energy efficiency.