Background: This paper presents a soft sensor design technique for estimation of pitch and yaw angular positions of a Twin Rotor MIMO System (TRMS). The objective of the proposed work was to calculate the value of pitch and yaw angular positions using a stochastic estimation technique. Methods: Measurements from optical sensors were used to measure fan blade rotations per minute (RPM). The Kalman filter, which is a stochastic estimator, was used in the proposed system and its results were compared with those of the Luenberger observer and neural network. The Twin Rotor MIMO System is a nonlinear system with significant cross coupling between its rotors. Results: The estimators were designed for the decoupled system and were applied in real life to the coupled TRMS. The convergence of estimation to the actual values was checked on a practical setup. The Kalman filter estimators were evaluated for various inputs and disturbances, and the results were corroborated in real time. Conclusion: From the proposed work it was seen that the Kalman filter had at least Integral Absolute Error (IAE), Integral Square Error (ISE), Integral Time Absolute Error (ITAE) as compared to the neural network and the Luenberger based observer.