The two-phase induction machine (TPIM) is widely used in many light-duty applications were three-phase supply is not readily available also a two phases symmetrical or unsymmetrical can be shift auxiliary winding. Therefore, in the indirect field oriented control, the rotor circuit time constant is an important parameter. Incorrect estimation of the rotor time constant also leads to incorrect flux angle calculations and can cause significant performance deterioration if no means for compensation or identification is applied. The magnetic saturation, the operating temperature and difficulties in using sensors for speed measurement are one of the sources of parameters variations, caused by non-linear nature of the magnetizing curve and the variations of the rotor resistance. The classical indirect field-oriented control is highly sensitive to the inductance values decrease when increasing the saturation level.