In turbomachines, dry friction resulting from stator–rotor contacts is a severe problem that may degrade lifetime of the machine or even lead to complete failure. Knowledge about the system states and contact forces is beneficial for system monitoring or to prevent contacts through, e.g., active magnetic bearings. In this paper, a nonlinear model is derived that describes the lateral rotor vibrations in the case of contact and no contact. The elastic behavior of the shaft is modeled based on the finite-element method. The contact is described by a dry friction model. An augmented system description is formulated that allows estimation of rotor displacements and contact forces by means of nonlinear filtering approaches like an extended Kalman filter. A simulation study was conducted that explicitly considered the hazardous backward whirl. The suggested approach shows suitable estimation performance related to both state and contact force estimation.