This paper addresses the aerodynamic modeling, observer-based state-feedback robust control and sensor fault detection for a laboratory ducted coaxial-rotor UAV (DCUAV). First, by introducing the main model elements of this novel unmanned vehicle, the detailed nonlinear mathematical model of the hovering flight UAV is presented. Second, through introducing a weighting matrix and a new form of change-of-variables, a new method is proposed by designing two different systems simultaneously as detector and controller. An observer-based controller is proposed to achieve the control objective and finite-frequency sensor fault detection objective simultaneously. The observer-based controller design method is derived from a new formulation of linear matrix inequality (LMI), which can achieve the prescribed H ∞ performance, H - performance and the stability of the closed-loop system. By constructing a new matrix decomposition form, the simultaneous design of detector parameters and controller parameters is solved. Finally, simulations are conducted for the hover flight with disturbances and sensor faults, the results show the satisfactory control performance and fault detection performance.