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The output feedback dissipation control problem for nonlinear systems is investigated. A design approach for the output feedback dissipation controller is presented, and the robustness analysis of this controller shows that the output feedback gain is larger the L2 gain from the disturbance input signal to the regulation output signal is smaller. The controller is then utilized to solve the water-level control problem for a U-tube steam generator (UTSG) of a nuclear power plant. Simulation results show the high performance of this new controller.