A new high-performance control method for surface PM synchronous motor is presented here. In this technique, orientation and amplitude of stator voltage vector are directly controlled to achieve stable operation and optimal dynamic performance. Through voltage vector position control, stator current is aligned at nearly ∠ 90 ∘ angle from rotor direct axis. This condition resembles with that of vector control and ascertains fast transient response. Orientation of stator voltage is controlled with the help of measured rotor position and estimated power factor angle. To acquire position information, an absolute optical encoder is used. The amplitude of voltage vector is varied proportionally with rotor frequency to optimize input current. Performance of the drive is comparable to existing vector-controlled drives with position sensors and better than available sensorless drives. Furthermore, the developed drive is simple and cost effective since closed-loop current control or any kind of position observers is not used. Extensive simulation and experimental studies are carried out to evaluate the performance of the drive. The results are found satisfactory.