Remotely Operated underwater Vehicles (ROVs) are getting more and more advanced withevery new model. As new functionality is added, the price increases. This thesis is one partof a larger project, where the goal is to develop a low-budget ROV. The ROV should later bemade autonomous and entered into a competition.This thesis have focused on the modeling and stabilizing control of an ROV that was designedby mechanical engineering students at Linköping University. The only sensor used was anInertial Measurement Unit (IMU) and the ROV has a torpedo-like design. The modeling wasdone using identification in Matlab with the grey box and black box methods. Water trialsand simulations show that the model is estimated sufficiently good to be used as the basis ofdifferent model based controllers.Two different control strategies were implemented; a linear quadratic controller (LQ) and amodel predictive controller (MPC). Both controllers worked desirably in simulations. Onlythe LQ controller was evaluated in real world tests. Due to problems with the implementationenvironment chosen for the MPC, the MPC could not be tested.The thesis also uses decision matrices as a mean to motivate the important decisions thathave been made.