Abstract: Incremental encoders are heavily used as speed measurement sensors in servo motor systems. Speed estimation in these applications is frequently affected by system vibrations and quantization errors. To avoid this problem, a variable-sampling-rate observer was proposed. Instead of numerical differential operation used in the M/T method, the proposed procedure was based on numerical integration, so vibration noise could be effectively suppressed. In order to eliminate quantization errors, the observer adapts its sampling period with the generated encoder pulses in each calculation cycle. Varying sampling period changes the poles of the observer, which deteriorates the stability of the system, so a gain calculation procedure was given in order to maintain stability in wide speed range. Experimental result shows that the proposed observer can effectively reduce estimation error caused by quantization error and vibration, and obtain better precision while guaranteeing good dynamical performance.