“…On the other hand, since nonlinear systems are more common in practice, observer based FD techniques for nonlinear systems have also been studied extensively (Frank, 1994;Hammouri et al, 1999;Ferrari et al, 2007;Narasimhan et al, 2007;Shumsky, 2007;Edelmayer et al, 2004). There are many works dealing with Lipschitz nonlinear systems (Pertew et al, 2007;Chen and Saif, 2007;Rajamani and Ganguli, 2004;Yaz and Azemi, 1998;de Souza et al, 1993;Xie et al, 1996;Abbaszadeh and Marquez, 2008), since, under some conditions, more general nonlinear systems can be transformed into Lipschitz nonlinear systems (Rajamani, 1998). In this paper, we extend the integrated FD system design ap-proach which has been well developed for linear systems to uncertain Lipschitz nonlinear systems, based on the following formulation: Given the FDR, minimize the FAR.…”