Active safety systems have become an essential part of today's vehicles including SUVs and LTVs. Although they have advanced in many aspects, there are still many areas that they can be improved. Especially being able to obtain information about tire-vehicle states (e.g. tire slip-ratio, tire slip-angle, tire forces, tire-road friction coefficient), would be significant due to the key role tires play in providing directional stability and control. This paper first presents the implementation strategy for a dynamic tire slip-angle estimation methodology using a combination of a tire based sensor and an observer system. The observer utilizes two schemes, first of which employs a Sliding Mode Observer to obtain lateral and longitudinal tire forces. The second step then utilizes the force information and outputs the tire slip-angle using a Luenberger observer and linearized tire model equations. Next, an adaptive vehicle stability controller is developed based on the estimated tire slip-angle information. The proposed algorithm is based on Lyapunov stability criteria where the adaptation parameters are taken as the front and rear tire cornering stiffness values to be able to adapt the system to the variations in the road surface conditions. The resulting control laws integrate Active Front Steering and Direct Yaw Control schemes. The performance of the proposed system is evaluated using a two-axle truck model under an evasive double lane change maneuver on high and low friction surfaces. The results indicate that the system can successfully stabilize the vehicle as well as adapting to the changes in surface conditions.