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This paper presents a synthesis of fault diagnosis method for nonlinear systems through the parameter estimation using higher order sliding modes. Initially the uncertain parameters of nonlinear system using robust exact differentiator are estimated. Then residual signal is reconstructed using the estimated parameters, inputs, outputs and their estimated derivatives. The novelty of the method is the determination of unknown, uncertain system parameters by calculating accurate derivatives of the measured system inputs and outputs. To validate the technique, simulations have been performed for a uncertain nonlinear Three Tank System. The convergence in this approach is shown to be faster than similar existing techniques by an order of magnitude even in the presence of measurement noise. The proposed fault diagnosis technique requires no prior information about uncertain/unknown process parameters and statistical knowledge of process.