The discovery of patterns and correlations hidden in the test data could help reduce test time and cost. In this paper, we propose a methodology and supporting statistical regression tools that can exploit and utilize both spatial and inter-test-item correlations in the test data for test time and cost reduction. We first describe a statistical regression method, called group lasso, which can identify inter-test-item correlations from test data. After learning such correlations, some test items can be identified for removal from the test program without compromising test quality. An extended version of this method, weighted group lasso, allows taking into account the distinct test time/cost of each individual test item in the formulation as a weighted optimization problem. As a result, its solution would favor more costly test items for removal from the test program.We further integrate weighted group lasso with another statistical regression technique, virtual probe, which can learn spatial correlations of test data across a wafer. The integrated method could then utilize both spatial and inter-test-item correlations to maximize the number of test items whose values can be predicted without measurement. Experimental results of a high-volume industrial device show that utilizing both spatial and inter-test-item correlations can help reduce test time by up to 55%.