This study aims at providing a fault detection and diagnosis (FDD) approach based on nonlinear parity equations identified from process data. Process knowledge is used to reduce the process nonlinearity from high to low-dimensional nonlinear functions representing common process devices, such as valves, and incorporating the monotonousness properties of the dependencies between the variables. The fault detection approach considers the obtained process model to be nonlinear parity equations, and fault diagnosis is carried out with the standard structured residual method. The applicability of the approach to complex flow networks controlled by valves is tested on the drying section of an industrial board machine, in which the key problems are leakages and blockages of valves and pipes in the steam-water network. Nonlinear model equations based on the mass balance of different parts of the network are identified and validated. Finally, fault detection and diagnosis algorithms are successfully implemented, tested, and reported. (C) 2013 Elsevier Ltd. All rights reserved.