Summary: One of the problems with designing an active vehicle suspension system is resolving the conflict between road handling and passenger comfort. This issue is the subject of this paper where a quarter-car two-degree-of-freedom system with nonlinear suspension dynamics is considered. An ideal suspension system is characterized by desired transfer functions from road surface irregularities to the motion of sprung and unsprung masses. To achieve the desired response and thus to resolve the mentioned conflict, a multi-layered novel scheme is proposed: an extended observer is used to estimate the nonlinear effects as well as the road profile. This observer relies on two position (or deflection) measurements. Based on the estimator, a simple adaptive feedback-linearization scheme is implemented to cancel the effects of the nonlinearities. Finally, the frequency content of the estimated road profile serves as a selection criterion in a variable-gain linear control scheme. Simulation results demonstrate the merits and the applicability of the proposed approach.