A LTHOUGH the past three decades have witnessed several important developments in attitude stabilization control [1,2], there still remain certain open problems that are of great theoretical and practical interests, such as actuator constraint. Because of physical limitations, typical control actuators (e.g., reaction wheels and thrusters) for attitude control have an upper bound on the torque they can generate. If this issue is not solved during attitude maneuvering, then the attitude system will continue issuing its commands that may no longer be achievable by the satellite, and the required control will quickly saturate actuators. This will subsequently destabilize and even lead to loss of control of the satellite. Therefore, actuator constraint is one key issue that needs to be addressed. At present, a great deal of attention has been focused on the stability analysis and the attitude control design with saturated actuators [3–6]. Another problem that needs to be addressed is fault tolerant control for the attitude system. Any component or system fault can potentially cause a host of economic and safety problems. As a result, online and real-time fault tolerant control (FTC) design for satellites has received considerable attention [7]. Generally speaking, FTC can be classified into two types: passive and active [8]. The passive FTC is designed to be robust to a class of possible faults. It does not require fault detection and diagnosis (FDD) schemes. In an attempt to develop attitude controllers that can accommodate faults, extensive studies on the passive FTC control system for satellites have been performed [9–11]. The active FTC can react to fault events by using a reconfigurationmechanism. The active FTC relies on the availability of an FDD mechanism that gives, in real time, information about the nature and the intensity of the fault. The design of active FTC, especially the fault detection and diagnosis scheme for satellite attitude, has attracted considerable interest [12–14]. Although the methodologies including FDD and control law reconfiguration for the control-type faults of satellite attitude system have been studied extensively (as seen in the preceding references), the problem that is not solved yet is the effective and practical strategies for handling severe failure cases combining with actuators constraint. Lack of such effective FTC strategies may lead to substantial performance deterioration and even the loss of a satellite. The clear knowledge of the link between control reconfiguration and the actuator input constraint is still lacking. Because the control reconfiguration at different time instants with different types of faults has greatly different effects on control actuators saturation, there is no explicit and simple relationship between them, which makes this problem even more difficult. This leads to an important practical problem: how tomake use of the control reconfiguration on available control redundancy. Motivated by this problem, a novel attitude control approach is presented in this paper; an observer-based FDD scheme combining a sliding mode controller by using the estimated information is designed in a framework of active FTC system. The main contribution of this study, relative to otherworks, is that actuator faults, actuator constraints, and external disturbances are simultaneously addressed in an attitude FTC system design.