Degree: Master of Science Abstract: The interest of Unmanned Aerial Vehicles (UAV) for civil application has increased dramatically in recent years. With improvement in computer hardware, lightweight sensors, and light material, the cost of UAVs has reduced significantly. UAVs with vertical takeoff and landing capabilities have been the focus of much development. A mathematical model for a scale RC helicopter including the rotor dynamics is presented in this work. The main rotor lift slope CL, the main rotor aerodynamic drag coefficient CDo, and the moments of inertia about the center of gravity are determined by the use of two sets of HIL testbeds. The avionics instrumentation, communication protocol and Ground Station system are described in detail. Finally, the model linearization and the LQR/LQG compensator in output feedback configuration with reference inputs are presented. Simulation results show that the proposed compensator stabilized and control the linearized dynamic of the helicopter.