This chapter considers an adaptive disturbance observer that simultaneously estimates the parameters, state variables, and disturbances of a control plant with unknown parameters. It shows a design process of an adaptive disturbance observer by making use of a Kreisselmeier-type adaptive observer. The chapter introduces the basic design flow and design examples based on the assumption of designable plants. It then introduces the general structure of an adaptive observer and understand the path to designing each element of the observer in sequence. Considering that all 2n coefficients of the transfer function are unknown, it is necessary to devise a way to estimate them. Then, professional engineers' need to design a state variable filter in the form of nonminimal realization instead of a state variable filter.