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Special-purpose CAD hardware is increasingly being considered as a means to meet the challenge posed to conventional (software-based) CAD tools by the growing complexity of VLSI circuits. In this paper we describe the architecture of a logic simulation machine employing distributed and parallel processing. Our architecture can accommodate different levels of modeling ranging from simple gates to complex functions, and support timing analysis. We estimate that simulation implemented by the proposed special-purpose hardware will be between 10 and 60 times faster than currently used software algorithms running on general-purpose computers. With the available technology, a throughput of 1,000,000 gate evaluations/second can be achieved.