Abstract: This paper presents a new stable robust adaptive controller and observer design for a class of nonlinear systems that contain i. Coupling of unmeasured states and unknown parameters ii. Unknown dead zone at the system actuator. The system is firstly cast into a modified form in which the observer and parameter estimation become feasible. Then a stable robust adaptive controller, state observer, parameter update laws are derived that would provide global adaptive system stability and desirable performance. To validate the approach, simulation was performed to a single-link mechanical system with a dynamic friction model and unknown dead zone exists at the system actuation. Then a comparison is presented with the results when there is no dead zone at the system actuation.