A finite-dimensional discrete-time distribution controller is designed for a class of distributed parameter systems with control inputs in and/or on the body. The systems are described by a partial differential equation of parabolic type. The measured outputs of the system are assumed to be obtained through a finite number of point sensors located in and/or on the system. The proposed controller is a combination of a low-spillover distribution observer and a liner state feedback law. Sufficient conditions are given for the existence of the output regulation. A practical trade-off measure is also shown between the order of the controller and the sampling interval. The low-spillover distribution observer is realized on the basis of an accurate modeling of the system which is described in discrete time and contains a special feedforward pass. By using standard state variable techniques in the finite-dimensional control theory, it becomes possible for system designers to construct a state feedback distribution observer-regulator without troublesome preparations such as sensor allocation to avoid the observation spillover.