The main focus of this paper is design of reduced order observer in nonlinear system. Rigorous mathematical model is needed to handle nonstationary process and many accidents occur in these conditions more than steady state operating conditions and reactor is important part of chemical process from its dynamic changes of properties such as temperature, concentration and pressure. Furthermore, its dynamics is nonlinear. So, this problem cannot be solved with SPC and linear system modeling so that we tried to solve it with nonlinear state observer. And we intended to apply reduced order observer similar from linear system. In this study, we considered the concentration is unmeasurable and only temperature is measurable. We examined convergence of the estimation error. As a result, the concentration is successfully observed. Additionally, we are curious about its dynamics under disturbance so carried it on under some conditions. And we discovered interest of gap between actual and observered value so that we suggested possibility of fault detection.