This paper presents an Adaptive Observer (AO) based Model Predictive Control (MPC) for a multilevel Flying Capacitors Inverter (FCI). The proposed system consists of a midpoint dc-link 3-cell 4-level FCI feeding an RL load. Using the actual load current, the proposed AO accurately estimates accurate capacitors’ voltages, which are qualified for the MPC design by making use of a hybrid model in which both discrete and continuous variables are considered. For real-time constraints, sufficient conditions are given to guarantee the practical stability of the proposed AO based MPC (AO-MPC). Theoretical analysis and experimental results are given to show that the proposed method is stable for all system configurations and has good performances even during load disturbances (load current sudden changes and parameters variation).