This paper explores the optimal filtering problem for microgrid state estimation considering packet losses in the internet of things (IoT) networks. The considered IoT networks collect microgrid information from smart sensors and send control messages to actuators where sensors and actuators are linked over a lossy network. Explicitly, the distribution power system incorporating renewable distributed energy resources such as wind turbine is represented as a state-space model where IoT element such as smart sensors are deployed to obtain measurements. This sensing information is transmitted to the fusion center through a lossy IoT communication network where measurements are lost. This paper proposes an optimal estimator based on the mean squared error between the actual states and its estimate. Afterwards, a state feedback controller is designed based on the semidefinite programming approach under the condition of packet dropouts in the IoT network. The efficacy of the proposed approaches are demonstrated by presenting an environment-friendly microgrid model incorporating distributed energy resources.