In this paper, a novel adjustable parameter (AP)-based distributed fault estimation observer (DFEO) is proposed for multiagent systems (MASs) with the directed communication topology. First, a relative output estimation error is defined based on the communication topology of MASs. Then a DFEO with AP is constructed with the purpose of improving the accuracy of fault estimation. Based on ${H} _{{\infty }}$ and ${H} _{{2}}$ with pole placement, multiconstrained design is given to calculate the gain of DFEO. Finally, simulation results are presented to illustrate the feasibility and effectiveness of the proposed DFEO design with AP.