Coordination of chassis control systems can contribute to an improved overall performance of a vehicle. In this paper, a novel vehicle stability control scheme is proposed that integrates both the direct yaw moment control and active rear steering. The controller is synthesized via an upper-level control structure and a lower-level control structure. The required yaw moment and rear steering angle are generated using a sliding-mode controller in the upper-level control. The stability of a sliding-mode controller is proved using a Lyapunov function. The yaw moment is subsequently realized by distributing the braking torque between appropriate wheels in the lower-level control using a braking torque distribution scheme. The effectiveness of the proposed controller is demonstrated through open-loop and closed-loop simulations of a non-linear vehicle model, in terms of selected vehicle handling and control performance measures, namely yaw rate and side-slip angle tracking. The results obtained for different manoeuvres suggest that the proposed two-level control scheme can help to achieve substantial enhancements in the handling performance and the stability performance of the vehicle.