This paper proposes a novel, observer-based, indirect model reference fuzzy control approach for nonlinear systems, expressed in the form of a Takagi Sugeno (TS) fuzzy model. Based on this model, an adaptive observer based, indirect model reference fuzzy controller is developed to deal with external disturbances. In contrast to what is seen in the literature on adaptive observer based TS fuzzy control systems, the proposed method is robust in the existence of bounded external disturbances and it is capable of tracking a reference signal rather than just regulation. The proposed method is simulated on the control of Chua's circuit and it is shown that it is capable of controlling this chaotic system with high performance.