A controller for an AC rotary machine which performs a smooth drive from a low-speed region including zero speed to a high-speed region, and which can attain, even if an initial value error is present in an estimated phase, desired characteristics by promptly converging the error. An adaptive observation mechanism outputs an estimated magnetic flux phase, an estimated current vector, an estimated magnetic flux vector, and an estimated speed, based on a voltage instruction vector, a current deviation vector, and an amplified deviation vector; a deviation vector calculator calculates the current deviation vector between the estimated current vector and a detected current vector from a current vector detector, and a magnetic flux deviation vector between the estimated magnetic flux vector and a detected magnetic flux vector from a magnetic flux vector detector; and a deviation amplifier amplifies the current deviation vector and the magnetic flux deviation vector, and outputs the result as the amplified deviation vector.