SummaryRejection of unknown periodic disturbances in multi‐channel systems has several industrial applications that include aerospace, consumer electronics, and many other industries. This paper presents a design and analysis of an output‐feedback robust adaptive controller for multi‐input multi‐output continuous‐time systems in the presence of modeling errors and broadband output noise. The trade‐off between robust stability and performance improvement as well as practical design considerations for performance improvements are presented. It is demonstrated that proper shaping of the open‐loop plant singular values as well as over‐parameterizing the controller parametric model can significantly improve performance. Numerical simulations are performed to demonstrate the effectiveness of the proposed scheme. Copyright © 2016 John Wiley & Sons, Ltd.