A fault isolation and estimation scheme for turn-to-turn short circuit (TTSC) in the permanent magnet synchronous motor (PMSM) systems is proposed in this article. When the short-circuit (SC) fault occurs, the fault phase current will change, while to simplify the calculation difficulty, the SC fault is modeled as current change in the two-phase rotating coordinate system. Then, a fault detection observer is designed to detect the fault occurrence time, then the coordinate transformation technique is developed to convert the system into subsystems affected only by single fault. Adaptive observers are designed to estimate the fault and disturbance simultaneously. The observer parameters are determined by linear matrix inequality (LMI). The specific location of the SC fault can be known after the inverse Park transformation. Finally, experimental results and comparison experimental results provide evidence of the feasibility of the suggested algorithm.