This paper investigates the development of Fault Detection and Isolation (FDI) filters for both retarded and neutral time-delay systems with unknown time-varying delays. Using a geometric framework, the notion of a finite unobservability subspace is introduced for time-delay systems and an algorithm for its construction is presented. A bank of residual generators is then designed so that each residual is affected by one fault and is partially clecoupled from the others while the H-infinity norm of the transfer function between the disturbances and the uncertainties in delays and the residuals are guaranteed to remain less than a prescribed value. Furthermore, it is shown that in the case of known delays it is possible to generate residuals that enjoy perfect decoupling properties among faults. Simulation results presented demonstrate the effectiveness of our proposed FDI algorithms. (C) 2009 Elsevier Ltd. All rights reserved.