In this paper, we consider the problem of observer-based controller design for nonlinear systems which can be represented by Takagi-Sugeno (T-S) fuzzy systems. Two practical restrictions have been considered to cover a more general problem. First, we suppose that the premise variables of the T-S model are unmeasurable, which permits one to utilize the proposed method in more practical systems. Second, actuator saturation is considered as a physical limitation and the controller is designed subject to this restriction. Sufficient conditions for the existence of such a controller are derived in terms of linear matrix inequalities (LMIs). The effectiveness of developed technique is shown through a numerical example.