Resolvers are rugged absolute position transducers which are widely used in various servo systems. The main shortcomings of resolvers are their nonlinear output signals, and therefore additional process is needed to obtain the linear angular signal. This paper presents a new resolver to digital converter (RDC) design method based on the extended state observer (ESO) with the advantages of noise insensitivity and higher tracking accuracy. An alternative demodulation strategy is also suggested where the output of resolver is sampled at two critical points. Such a treatment can realize demodulate resolver's output more accurately. Finally, simulation and experiment results are given with respect to a full FPGA digital system.