This paper proposes a method of estimating road friction and tire slip angle in a cornering maneuver. The method can estimate front tire road friction accurately at low lateral acceleration because it is based on the tire self-aligning torque (SAT) that exhibits high sensitivity to road friction at low slip angles. Road friction and tire slip angle, which are mutually interdependent, are estimated simultaneously using an extended Kalman filter designed around a model describing the relationship between road friction and SAT and a vehicle lateral dynamic model. The front tire SAT is calculated with a mathematical model that describes the torque transmission characteristics from the electric power steering torque to SAT. Therefore, the proposed method is readily applicable to production vehicles. Results of an experimental study show that the change in road friction is instantaneously estimated at low lateral acceleration.