Abstract. Fault detection and isolation are very important elements in the design of faulttolerant decision support systems for ship operator guidance. This study outlines remedies that can be applied for fault diagnosis, when the ship responses are assumed to be linear in the wave excitation. A novel numerical procedure is described for the calculation of residuals using the ship's transfer functions which correlate the wave excitation and the ship responses. As tests, multiplicative faults have artificially been imposed to full-scale motion measurements and it is shown that the developed model is able to detect and isolate all faults.