It is highly desirable to systematize and automate the process of designing diagnosis systems. The reason is that in many applications, high diagnosis performance is required, and at the same time, the time-consuming engineering work of designing diagnosis systems must be minimized. Here, model-based diagnosis based on structured hypothesis tests is considered. Principles for evaluating diagnosis systems are developed, and a systematic and automatic design procedure is proposed. The procedure is successfully applied to the problem of designing a diagnosis system for the air-intake system of an automotive engine. The resulting diagnosis system is then experimentally validated using a real engine.