An output-feedback model-reference variable structure controller based on a high-gain observer (HGO) is proposed and analyzed. For single-input-single-output (SISO) linear plants with relative degree greater than one, the control law is generated using the HGO signals only to drive the sign function of the variable structure control component while the sign function gain, also called modulation, as well as the other components of the control signal are generated using signals from state variable filters which do not require high gain and are free of peaking. This scheme achieves global exponential stability with respect to a small residual set and does not generate peaking in the control signal. (C) 2009 Elsevier Ltd. All rights reserved.