Detection of a tool fracture is necessary to ensure cutting accuracy and to avoid a tool breakage because tool fracture is one of the significant prediction signals of the tool breakage. For monitoring the tool condition, generally additional sensors are used. However using these sensors causes high cost and increase of failure rate. In this paper, a novel sensor-less detection method of tool fracture in drilling process is proposed on the basis of a disturbance observer theory. It is applied to the x-y stage of the machine tool. The proposed method requires no external sensor because it uses only the servo information of the spindle control system. Since structures of normal drills with two floats are symmetrical with respect to a point, theoretically the cutting force in the x and y directions does not work. When the drill is fractured, its structure becomes asymmetry so that unbalanced forces would exert in the x and y directions at intervals of the spindle speed. Therefore, it is possible to detect a tool fracture by the frequency analysis of estimated disturbance force with a wavelet transform. The experimental results show that the proposed method is available for detection of the small tool fracture effectively.