This paper presents an observer design for SCR mid-catalyst ammonia concentration estimation using tailpipe $NO_x$ and ammonia sensors. Urea-SCR has been popularly used by Diesel engine powered vehicles to reduce $NO_x$ emissions in recent years. It utilizes ammonia, converted from urea injected at upstream of the catalyst, as the reductant to catalytically convert $NO_x$ emissions to nitrogen. To simultaneously achieve high SCR $NO_x$ conversion efficiency and low tailpipe ammonia slip, it is desirable to control the ammonia storage distribution along the SCR catalyst. Such a control method, however, requires a mid-catalyst ammonia sensor. The observer developed in this paper can replace such a mid-catalyst ammonia sensor and be used for SCR catalyst ammonia distribution control as well as serves for fault diagnosis purpose of the mid-catalyst ammonia sensor. The stability of the observer was shown based on the sliding mode approach and analyzed by simulations. Experimental validation of the observer was also conducted based on a medium-duty Diesel engine two-catalyst SCR system setup with emission sensors.