A nonlinear inferential cascade control strategy for a tubular fixed-bed reactor with highly exothermic reaction is presented. Tight control of Exit conversion and stabilization of hot-spot temperature was achieved over a wide range of operating conditions. A multiple cascade structure was developed by lumping the distributed-parameter system and partitioning it into three subsystems. practical issues of implementing the control system are addressed as well as physical insight and assumptions used for model reduction of each subsystem. The direct synthesis approach for nonlinear control systems is used to design the controllers of the important subsystems separately. A lag was added in the primary subsystem, and fast stabilization of the secondly subsystem? was implemented. Unknown temperature states and inlet concentration were estimated by a nonlinear observer from only a few temperature measurements. The control problem of the moving hot-spot temperature was also addressed. Simulation on an industrial phthalic anhydride fixed-bed reactor showed that the observed can give excellent dynamic tracking of the reactor The resulting cascade control system can achieve good set-point tracking and disturbance rejection performance which is robust in the presence of measurement error and model mismatch, and superior to a single-loop control system.