In this paper, it is shown that an input-output (I/O) feedback linearized controller can be designed rationally by utilizing the time-scale properties of heave and pitch for an underwater vehicle. It is assumed that the dynamics of the vehicle is restricted to the vertical plane. An output-feedback control is designed, which stabilizes steady cruising paths. It is shown that the vehicle dynamics with acceleration as output becomes minimum phase. The dynamics can be transformed into a reduced system through a kind of partial linearization and singular perturbation technique. The reduced system is not only minimum phase but also exactly I/O linearizable via feedback. The I/O dynamic characteristics of the heave and pitch modes can be made linear and decoupled. Furthermore it becomes independent of cruising condition such as vehicle velocity. This study may help for designing autopilot systems for underwater vehicles.