This article studies the problem of fault estimation (FE) and dynamic output fault‐tolerant control (DOFTC) for a class of Takagi–Sugeno (T–S) fuzzy singularly perturbed systems (SPSs) which subject to time delay, external disturbance and actuator fault. A new fault estimation and fault‐tolerant control scheme was proposed and designed for the influence of the change of perturbation parameter on the singularly perturbed system. This scheme adopts the Takagi–Sugeno (T–S) fuzzy model, learning observer and dynamic output feedback fault‐tolerant mechanism, so that the system has multi‐time‐scale dynamic stability. The results show that this method has more accurate estimation effect, faster convergence speed, and very fast steady‐state response of fault‐tolerant control when faults occur. Furthermore, when constructing the Lyapunov function, the improved matrix was selected to ensure that the closed‐loop system is stable for all , and at the same time, the conservativeness of the results was reduced. Finally, the feasibility and correctness of the proposed design method were illustrated through two numerical examples.