Accurately estimating the State of Charge (SOC) of the battery is the basis of Battery Management System (BMS). This paper has introduced a new modeling and state estimation method for the lithium battery system, which utilizes the fractional order theories. Firstly, a fractional order model based on the PNGV (Partnership for a New Generation of Vehicle) model is proposed after analyzing the impedance characteristics of the lithium battery and compared with the integer order model. With the observability of the discrete non-linear model of the battery confirmed, the method of the state observer based on the extended fractional Kalman filter (EFKF) and the least square identification method of battery parameters are studied. Then, it has been applied successfully to estimate the battery SOC using the measured battery current and voltage. Finally, a standard HPPC (Hybrid Pulse Power Characteristic) test is used for parameter identification and several experimental validations are investigated on a ternary manganese-nickel-cobalt lithium battery pack with a nominal capacity of 24 Ah which consists of ten Sony commercial cells (US18650GR G7) in parallels. The results demonstrate the effectiveness of the fractional order model and the estimation method.