This paper presents a high-gain observer based internal model disturbance observer for enhancing the disturbance compensation perfromance. Inspired by the rold of each block of the Q-filter based disturbance observer, the high-gain observer structure is employed in the proposed disturbance observer to estimate the state of the plant so as to design the outer-loop state feedback controller instead of the output feedback control. In addition, to completely reject the effect of the sinusoidal disturbance, we provide a selection method for the Q-filter"s coefficients to embed the internal model of the disturbance into the Q-filter in the positive feedback loop. By the singular pertubation theory, it is shown that the proposed disturbance observer can compensate for the effect of disturbance and recover the performance of the normal closed-loop system. Moreover, a rubust stability condition of the overall and recover the performance of the nominal closed-loop system. Moreover, a robust stability condition of the overall closed-loop system is derived under model uncertainties, and a design procedure of two Q-filters for satisfying the derived stability conditin is presented. To verify the disturbance compensation performance of the proposed disturance observer, simulation results for a mechanical system are provided.