Adaptive structures are advanced structural systems allowing variation of geometrical and structural characteristics to meet mission requirements. The aim of this paper is to develop an advanced method for vibration control of complex modular elastic structures, which are often required to perform a variety of tasks in aerospace applications with limited resources. The paper's focus is on design of the observer-based decentralized controllers for these smart systems, to counteract the external dynamic loads and to reduce the dynamic stresses in the structural members during arbitrary loading. The new approach leads to substantial savings in computational time with respect to the conventional centralized control method. The concept is illustrated via numerical simulations for 2D elastic modular structures. Their response for various excitation cases, including the case of the failed sub-component controllers is considered in detail. For better interpretation of the efficiency of the designed smart systems, results of the simulations are illustrated using a Virtual Reality computer environment, offering advanced visual effects.