This paper presents the behavior and performance of a non-salient permanent magnet synchronous machine (PMSM) using speed and position estimation from very low speed to very high speeds at different torque levels. A sensorless method relying on back-EMF estimation and based on compensating the position error between the machine and controller dq frames has been found to be the most promising through simulation studies. The method is verified experimentally using a digital signal processor implementation for 2-quadrant operation. The position of the shaft at standstill is determined using an alignment sequence. Finally, a sensitivity analysis of the impact of the position estimation error on the machine torque is presented. The implementation and associated analysis prove that the selected algorithm is highly suitable for position sensorless PMSM drives coupled to passive loads, with a decrease of less than 1% in the output torque compared to drives using a position encoder. This paper also proposes a low cost solution for 4-quadrant operation using only one Hall effect sensor.