A safety instrumented system (SIS) is a complex unit composed of a set of hardware and software controls which are expressly used in critical process systems. A SIS should be specifically designed to obtain the failsafe state of the monitored plant or maintain safety of the procedure or a process when unacceptable or dangerous conditions occur. This paper focuses on condition monitoring and different diagnostic solutions used in safety instrumented systems, such as limit alarm trips, on-board diagnostics, and logic solver diagnostics. A case study consisting of the design of a safety loop using standard IEC 61508 for a complex safety instrumented system in the oil and gas field is presented in the paper using a diagnostics-oriented approach. The presented methodology aims at reaching the optimal tradeoff between IEC 61508 and the market requirements focusing on the best technological solutions to optimize diagnostics and safety and minimize the system’s response time in case of failure. The results of the application emphasize the importance of an accurate diagnostic strategy on safety instrumented systems for oil and gas plants.