In this paper, a new identification method for large 2D grids of interconnected systems is presented. The proposed algorithm minimizes the Output-Error of the lifted system by using a Steepest-Descent optimization method which exploit the Multilevel Sequentially-Semi Separable (MSSS) structure of the involved matrices. Furthermore, it is shown that the computational complexity of the proposed approach is linear with respect to the number of subsystems in the grid. Finally, a numerical example is presented in order to show the effectiveness of the proposed algorithm.