There is a strong scientific case for the study of gravitational waves at or below the lower end of current detection bands. To take advantage of this scientific benefit, future generations of ground based gravitational wave detectors will need to expand the limit of their detection bands towards lower frequencies. Seismic motion presents a major challenge at these frequencies and vibration isolation systems will play a crucial role in achieving the desired low-frequency sensitivity. A compact vibration isolation system designed to isolate in-vacuum optical benches for Advanced Virgo will be introduced and measurements on this system are used to present its performance. All high performance isolation systems employ an active feedback control system to reduce the residual motion of their suspended payloads. The development of novel control schemes is needed to improve the performance beyond what is currently feasible. Here, we present a multi-channel feedback approach that is novel to the field. It utilizes a linear quadratic regulator in combination with a Kalman state observer and is shown to provide effective suppression of residual motion of the suspended payload. The application of state observer based feedback control for vibration isolation will be demonstrated with measurement results from the Advanced Virgo optical bench suspension system. © 2014 AIP Publishing LLC.