An optimal fuzzy ÿlter was applied to solve the state estimation problem of the controlled irrigation canals. Using linearized ÿnite-di erence model of the open-channel ow, a canal operation problem was formulated as an optimal control problem and an algorithm for gate openings in the presence of unknown external disturbances was derived. A fuzzy ÿlter was designed to estimate the state variables at the intermediate nodes based upon measured values of depth at the points in the canal. A Lyapunov function was utilized as a performance index to formulate the fuzzy interference rules of the optimal fuzzy ÿlter. A linear quadratic Gaussian (LQG) optimal controller for a multi-pool irrigation canal was considered as an example. The state estimation problem in the controller was simulated using two techniques: Kalman estimator and the proposed fuzzy ÿlter. The performance of the fuzzy state estimator designed using the Lyapunov fuzzy technique was compared with the results obtained using the Kalman estimator technique. The obvious advantages of the fuzzy ÿlter were the lower computational costs and ease of implementation. The results of this study demonstrated that proposed Lyapunov-type fuzzy ÿlter provides both good stability and simplicity in the control of irrigation canals more than a Kalman ÿlter. 493 in which Q is the ow rate (m 3 =s), A the wetted area (m 2 ), q l the lateral ow (m 2 =s), y the water depth (m), t the time (s), x the longitudinal direction of channel (m), g the gravitational acceleration (m 2 =s), S 0 the canal bottom slope (m=m), n the roughness coe cient (s=m 1=3 ), and S f the friction slope (m=m) and is deÿned asin which K is the hydraulic conveyance of canal = AR 2=3 =n, R the hydraulic radius (m). In Equations (1) and (2), the spatial derivatives were replaced by ÿnite-di erence approximations, by dividing the pool into few segments (N = number of nodes). A central-di erence scheme was used for the interior nodes (1¡j¡N ), and a forward di erence and a backward di erence were applied to the ÿrst and the last nodes, respectively [5]. Both forward and backward ÿnite-di erence approximations (the neglected terms are of the ÿrst order of x) are referred to as ÿrst-order accurate. Central ÿnite-di erence approximation (the neglected terms is of the order of ( x) 2 ) is referred to as second-order accurate [16]. The central ÿnite-di erence approximation is more accurate than the forward or backward ÿnite-di erence approximations. The water levels or the volumes of water stored in the canal pools are regulated using a series of spatially distributed gates (control elements). Hence, open irrigation canals are modelled as distributed control systems. To solve Equations (1) and (2), the boundary conditions were expressed in terms of the continuity equation: