This paper addresses the problem of region tracking control for underwater vehicles without velocity measurement in marine environment. For this case, an improved region tracking control strategy is proposed based on a Nussbaum state observer. In the proposed method, a Nussbaum state observer is developed to estimate the unmeasured velocity of the vehicle. And then an improved region tracking control strategy is presented by incorporating the estimated results of the state observer, such that the tracking errors satisfy the requirement of the prescribed boundaries. In addition, a RBF neural network is applied to approximate the unknown dynamics of the vehicle. It is verified that the estimated error and the tracking error are uniformly ultimately bounded. Finally, the proposed observer-based region tracking control strategy is applied on an underwater vehicle to perform simulation studies and compared with a traditional backstepping controller and a traditional region tracking controller based on a high-gain observer. The comparative simulation results demonstrate the effectiveness of the proposed region tracking control strategy.