This article presents a nonlinear observer-based method to estimate the exhaust manifold pressure for the gasoline engines equipped with an exhaust gas recirculation system. A dynamic model is designed to estimate the exhaust manifold pressure, which includes both the intake manifold and exhaust manifold dynamics focusing on gas mass flows. Based on the developed model, a nonlinear exhaust manifold pressure observer is proposed to replace the exhaust manifold pressure sensor, and the global convergence is analyzed by a constructed Lyapunov function and the physical meaning of the time-varying parameters. The experimental validations show that the observer-based exhaust manifold pressure estimator is able to converge to the real value at arbitrary initial value and estimates the exhaust manifold pressure accurately during both the steady-state and transient conditions. Finally, the proposed exhaust manifold pressure observer is applied into the fault detection problem for the exhaust gas recirculation system. The experimental validations show that the observer is able to be used to estimate the exhaust gas recirculation ratio and as an extra signal to assist to detect the faults of the exhaust gas recirculation system accurately.