A novel Sliding Mode Control (SMC) based Active Queue Management (AQM) algorithm is proposed for control of TCP/IP based network. Modern switching networks are complex time delay process with abrupt time varying behavior of its parameters such as bandwidth, time delay etc., which makes it hard to capture the exact process dynamics for an efficient controller design. Our approach invokes the potential of SMC in terms of robustness and disturbance rejection to design effective controller for nonlinear TCP-queue dynamics. Sliding Mode design is based on Lyapunov matrix and search for Lyapunov matrix for systems with unmatched uncertainties and time delay is formulated in terms of Linear Matrix Inequlity. Proposed scheme exhibits robust performance in presence of large parameter uncertainties and disturbances. © 2011 ICROS.