An attempt was made to apply graph theory to the diagnosis of the system failures in the chemical process. A signed digraph is used for a mathematical model representing the influences among elements of the system. The concept of a pattern on the signed digraph is introduced for representing a state of the system. In order to eliminate carrying out the complicated and inefficient quantitative simulation, the mathematical model of the system structure to represent the rpopagation of failures is simplified in a qualitative fashion. The origin of the system failure can be located at the maximal strongly-connected component in the cause-effect graph reflecting the pattern of abnormality. Even when the pattern is observed only partially, the assumption of single origin of the failure reduces, to some extent, the range of possible candidates to be the first cause of the failure. © 1979.