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This paper proposes a discretization scheme and an optimal digital cascaded plus state-feedback controller for Multiple-Input-Multiple-Output (MIMO) continuous-time systems with multiple time delays in both inputs and outputs. Firstly, an equivalent discrete-time model is obtained from the MIMO analog time-delayed system. The equivalent discrete-time model and a partially predetermined digital cascaded controller are formulated as an augmented discrete-time state-space system for state-feed forward and state-feedback Linear Quadratic Regulator (LQR) design. As a result, the parameters of the cascaded controller and its associated state-feedback controller can be determined by tuning the weighting matrices in the LQR optimal design. Then a discrete-time optimal observer for the MIMO analog time-delayed system is constructed for the implementation of the designed state-feedback digital controller. The proposed methodology has been verified through both simulation and experiment on the induction motor drive system.