Abstract: Disclosed is a method and apparatus estimating yaw error and roll and yaw disturbance torques from measured roll error and yaw momentum on a continuous on-orbit basis in an orbiting satellite. The information thus obtained can be used to continuously correct for the yaw error by means of, for example, activating a magnetic torquer. Two control loops are used in this invention, a fast loop to damp nutations by changing momentum wheel speed, and a slow loop of the Luenberger observer variety. The latter is a yaw error correction loop which also serves to unload yaw momentum. The satellite in which the invention was first incorporated is of the type having three momentum wheels, all situated in the plane orthogonal to the roll axis. In normal operation, two wheels, each having major momentum component along the pitch axis and minor momentum component along the yaw axis, are operable.