This paper deals with the reliable control problem of nonlinear systems represented by switched fuzzy systems (SFS) with time-varying delay, where each subsystem of switched system is a time-varying delay fuzzy system. A switched fuzzy system with a Takagi and Sugeno (T-S) fuzzy model, which differs from existing ones, is firstly employed to describe a nonlinear system. When the actuators are serious failure, the residual part of actuators cannot make original system stability, using switching technique depends on the states of observers, and the fuzzy reliable controller based on measured observers states instead of the original system states information is built. The stabilization criterion of the reliable control problem is given for the case that the state of original system is unmeasurable. The multi-Lyapunov functions method is utilized to the stability analysis and controller design for time-varying delay switched fuzzy systems with faulty actuators. Moreover, observers switching strategy achieving estimation errors decreasing uniformly asymptotically to zero of the switched fuzzy systems is considered. Finally, the stabilization criterion is transformed into the solvability of sufficient linear matrix inequality (LMI) conditions. To illustrate the effectiveness of the proposed stabilization criterion and controller design approaches, a designed numerical example is studied, and some simulations are provided.