This paper deals with the problem of sensor fault tolerant control for Takagi-Sugeno nonlinear systems. Firstly, a residual generator is designed in order to detect and isolate sensor faults. Secondly, a nonlinear observer based controller, adopting the so-called parallel distributed compensation (PDC) structure is designed. The PDC controller is based on a weighted blending of the estimated states provided by different observers. Each observer is constructed to estimate the system state from the inputs and only one output. The blending of the estimates depends on the residual magnitudes in order to minimize the use of faulty estimates in the control law. The stability of the global closed-loop system is studied by Lyapunov theory and the gains of the fault tolerant controller are obtained by solving Linear Matrix Inequalities (LMI). Numerical examples are provided.