This paper presents a novel model with radial basis functions (RBFs), which is applied successively for online stable identification and control of nonlinear discrete-time systems. First, the proposed model is utilized for direct inverse modeling of the plant to generate the control input where it is assumed that inverse plant dynamics exist. Second, it is employed for system identification to generate a sliding-mode control input. Finally, the network is employed to tune PID (proportional + integrative + derivative) controller parameters automatically. The adaptive learning rate (ALR), which is employed in the gradient descent (GD) method, provides the global convergence of the modeling errors. Using the Lyapunov stability approach, the boundedness of the tracking errors and the system parameters are shown both theoretically and in real time. To show the superiority of the new model with RBFs, its tracking results are compared with the results of a conventional sigmoidal multi-layer perceptron (MLP) neural network and the new model with sigmoid activation functions. To see the real-time capability of the new model, the proposed network is employed for online identification and control of a cascaded parallel two-tank liquid-level system. Even though there exist large disturbances, the proposed model with RBFs generates a suitable control input to track the reference signal better than other methods in both simulations and real time. (C) 2010 ISA. Published by Elsevier Ltd. All rights reserved.