— In this paper we introduce a friction observer for robots with joint torque sensing (in particular for the DLR medical robot) in order to increase the positioning accuracy and the performance of torque control. The observer output corresponds to the low-pass filtered friction torque. It is used for friction compensation in conjunction with a MIMO controller designed for flexible joint arms. A passivity analysis is done for this friction compensation, allowing a Lyapunov based convergence analysis in the context of the nonlinear robot dynamics. For the complete controlled system, global asymptotic stability can be shown. Experimental results validate the practical efficiency of the approach.