Disclosed is a method and apparatus for 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 correct continuously for the yaw error by means of, for example, activating a magnetic torquer. Two control loops are described, a fast loop 69 to damp nutations by changing momentum wheel speed, and a slow loop 1 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. h normal operation, two wheels, each having major momentum component along the pitch axis and minor momentum component along the yaw axis, are operable. A third backup wheel aligned along the yaw axis becomes operable only in the eventuality that one of the primary wheels suffers a breakdown during the life of the satellite. The slow speed yaw loop 1 is used to adjust a magnetic coil torquer. It can be implemented in a number of forms including a hard-wired analog form or a digital computer with certain constant scaling factors programmed into the memory of the computer.