This paper proposes a single-phase Phase-locked loop (PLL) of the virtual two phase generator using full-order state observer, which is essential to find phase and frequency of the single-phase source. The conventional methods cannot remove the low-order harmonics included in source voltage, which influencesto whole PLL control system. The proposed algorithm separates fundamental wave from harmonics, and removes harmonics effectively. Therefore it generates only the fundamental wave. As it controls virtual voltage and input voltage together, it decreases steady-state error. From simulation and experimental results, the generated frequency by the proposed PLL which it plans, converges to the actual value, and the steady-state error is much reduced under given harmonic voltages. It is also confirmed that the proposed algorithm removed harmonics effectively and it generates only the fundamental wave.