This paper discusses the Model-on-Demand algorithm for fault isolation in large and complex technical systems. The main objective of the proposed algorithm is to improve fault isolation performance metrics by applying a structural analysis approach which targets the isolability problem in structurally time-invariant systems. This objective is achieved by the utilization of a reverse modeling approach in order to modify the structural matrix of the system in such a way to improve its isolability property. The proposed algorithm was tested in a real technical system and an overview of the experimental results is given here. © 2013 IEEE.