|Global navigation satellite systems are essential for positioning, navigation, and timing services. The quality and reliability of satellite observations determine the system performance, especially in the case of the newly launched global BDS-3 service. However, analyses of multipath delays in BDS-3 satellite observations suggest that there are appreciable errors at different frequencies. Improvement of the accuracy and precision of positioning, navigation, and timing services provided by BDS-3 requires the mitigation of multipath delays of the satellite observations. This paper models the multipath delays of BDS-3 observations using a least-squares combined autoregressive method. Furthermore, a sparse modeling algorithm is proposed to obtain a multipath delay series using total variation and elastic net terms for denoising and eliminating the effect of limited original observations. The estimated coefficients of multipath delays are then set as prior information to correct the next-arc code observations, where the square-root information filter is used in the coefficient estimation. Moreover, four groups of experiments are conducted to analyze the results of modeling the BDS-3 multipath delay using the proposed methods, with single-frequency precise point positioning (PPP) and real-time PPP solutions being selected to test the correction of multipath delays in BDS-3 code observations. The residuals of iGMAS and MGEX station coordinates indicate improvements in eastward, northward, and upward directions of at least 4.1%, 9.6%, and 1.2%, respectively, for the frequency B1I; 6.6%, 5.3%, and 0.2%, respectively, for B3I, 12.5%, 14.3%, and 3.8%, respectively, for B1C; and 5.9%, 7.4%, and 18.1%, respectively, for B2a relative to the use of the traditional method in BDS-3 single-frequency PPP. Furthermore, the real-time double-frequency PPP is optimized by at least 10% for B1I+B3I and B1C+B2a. An improved result was obtained with the proposed strategy in a standard point positioning experiment. The proposed multipath delay mitigation method is therefore effective in improving BDS-3 satellite code observations.