In this paper, a novel method for the design of robust nonlinear observer in the H∞ framework for Lipschitz nonlinear systems is proposed. For this purpose, a new dynamical structure is introduced that ensures the stability of observer error dynamics. Design innovation is the use of dynamic gain in the sliding mode observer. The additional degree of freedom provided by this dynamic formulation is exploited to deal with the nonlinear term. The performance of this stable H∞ observer is better than conventional static gain observers and the dynamic Luenberger observer. The compensator is designed in such a way that, while ensuring the stability of the closed-loop system, it prevents performance loss in the presence of the nonlinearities. By the proposed approach, the observer is robust to nonlinear uncertainties because of increasing the Lipschitz constant. Also, the design procedure in the presence of system and measurement noises is addressed. Finally, the simulation of our methodology is conducted on a nonlinear system to illustrate the advantage of this work in comparison with other observers.

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