This study presents a cost-effective sensorless whole-body compliance control strategy for collaborative manipulator. The control strategy realizes decoupled adjustable compliant effects, namely, stiffness, damping, and inertia controls, under a single control framework. The inherent position controller is retained, which ensures a smooth transition between normal position operation and compliance control. The two features can greatly simplify the customization of collaborative manipulator control algorithms. A modified sensorless disturbance observer based on generalized momentum is used to estimate the external torque, and this way eliminates the dependence on the force/torque sensors. Only basic motor position sensors are required. The compliant trajectory generated by the external torque is sufficiently smooth owing to the haptic filter. Various experiments prove that the modified sensorless disturbance observer is effective. The necessity of using the position servo loop for sensorless compliance control is discussed through a comparative experiment. The proposed compliance control strategy is further verified using sensorless and sensor-based disturbance observers.