We are concerned with models which are able to describe multiple-input multiple-output (MIMO) non-linear dynamic systems. These models are represented in the form of rules and are known as Tagaki-Sugeno models. An identification algorithm for these models based on input and output data is presented. Parameter estimation is based on the calculation of model sensitivity functions with respect to their parameters. Some aspects of structure identification are also tackled, i.e. determination of local model orders and number of rules.