In this paper, an observer-based adaptive control method is investigated for the horizontal trajectory tracking of autonomous underwater vehicles (AUV) with input saturation and system disturbances. Firstly, the desired surge speed and trajectory angle are established, which could decouple the tracking error subsystem and avoid the complex form. Secondly, the input saturation is approximated by a smooth function, and a nonlinear extended states observer (NESO) is designed for estimating system disturbances. Based on the command filtered backstepping technique, which can avoid the explosion caused by the derivative of the virtual control, an observer-based adaptive output feedback control method is developed, and an auxiliary system is applied to compensate for filtered tracking errors, input saturation bias, and observer errors. Finally, simulation results show the proposed method has good robustness in the face of system uncertainties, and the error is nearly 33.3% smaller than that of other control methods when meeting sudden trajectory changes. A good control performance is guaranteed.