This study is dedicated to design an observer for an automatic ball balancer system (ABS) to estimate the ball angular position; and further to apply ball re-position scheme to reside the desired angular position to reduce radial vibration which caused by the mass imbalance of high speed rotating spindle system. The observer for ABS system, in this study, mainly focuses on the application of CD/DVD-ROM system. For preliminary feasibility, the case of a single ball is considered. The first step is to establish the dynamic model of the system, which is followed by the analysis to ensure stability of the desired ball equilibrium position. The second step is to forge a sliding-mode observer for estimating on-line position and velocity of the ball. Finally, simulations and experiments are conducted to verify the effectiveness of proposed sliding-mode observer scheme.