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An improved control method of the buried-type interior permanent magnet (IPM) bearingless motors has been presented. It is shown that the conventional method is not applicable to this type of IPM bearingless motor for loaded conditions. In IPM bearingless motors, the armature reaction flux is present due to high magnetic permeance with thin permanent magnets and small airgap length. An increase in d-axis flux linkage is caused by armature reaction as a torque-component flux is increased. Thus, it is likely that magnetic saturation occurs in the stator teeth. In addition, a magnetic attractive force caused by the displacement force factor is dependent on the armature reaction flux. A new decoupling controller for the IPM bearingless motor considering magnetic saturation is proposed in this paper. It also considers the influence of magnetic attractive force variations. In addition, a new parameter identification method for the decoupling controller is also proposed. The new controller is found quite suitable to realize successful stable operation of the experimental IPM bearingless motor.