A novel approach to implement the distortion effect is introduced. The proposed approach is based on time-varying phase distortion of the input signal, and it is implemented using a coefficient modulated first-order allpass filter. This new technique provides control over the distorted band with a proper choice of the modulating signal. By choosing a modulating signal that applies the phase distortion only for low frequencies, the aliasing often generated by conventional distortion effects, which modify the signal amplitude, can be greatly reduced. Modulation signals that produce distortion effects applicable for electric guitar playing are also discussed. Sound examples on the use of the filter can be found at http://www.acoustics.hut.fi/~jpekonen/ Papers/dafx08/.