This paper is about method for mean value engine torque estimation to be used with dynamical engine test bench. The mean value engine torque is not measurable but necessary for some test bench applications e.g. for the Parameterization of the engine control unit. We present a two steps observer. The first part is a high gain Kalman filter which is for estimating the inner engine torque. The high gain is necessary to achieve a fast torque tracking. The second part is an internal model based observer which is used to filter the combustion caused oscillations from the estimated inner engine torque in order to achieve the mean value engine torque. The torque estimator is applied to real measurements and compared to a Butterworth filter.