In this article, the design and implementation of a fault-tolerant controller are proposed for an electro-hydraulic actuator (EHA) in the presence of disturbances and actuator faults. The existence of nonlinearities, uncertainties, and a bias fault (i.e., internal leakage fault) in the system dynamics significantly decreases the desired performance. The nonlinear disturbance observers (NDO) are constructed to handle the adverse influences caused by the above disadvantages. The whole fault-tolerant control (FTC) scheme consists of two design loops: an inner force control loop and an outer position control loop. The inner loop is based on an optimized backstepping framework to achieve the optimal performance, whilst the problem of uncertainties and disturbances is dealt with using a terminal sliding mode directly designed from the position tracking error. It is shown by theoretical analysis that system stability is ensured under faulty conditions. Finally, simulation results and comparison studies are conducted to further verify the effectiveness of the proposed approach.