This paper presents an improved sensorless vector control system for high performance induction motor drives fed by a matrix
converter with non-linearity compensation. The nonlinear voltage distortion that is caused by commutation delay and on-state
voltage drop in switching devices is corrected by a new matrix converter model. A Reduced Order Extended Luenberger Observer
(ROELO) is employed to bring better response in the whole speed operation range and a method to select the observer gain is
presented. Experimental results are shown to illustrate the performance of the proposed system.