The recent advances in data collection and storage capabilities have led to information overload in many applications, including on-line monitoring of spacecraft operations with time series data. Such datasets present new challenges in data analysis, especially for implementation in memory-constrained DECUs. Also, the traditional statistical methods break down partly because of the increase in the number of observations (measurements), but mostly due to an increase in the number of variables associated with each observation ("dimension of the data"). One of the problems with high-dimensional datasets is that not all the measured variables are "important" for understanding the underlying phenomena of interest. In addition to the computational cost, irrelevant features may also cause a reduction in the accuracy of some algorithms. The first key issue we propose to address is that of data reduction techniques for onboard implementation of data-driven classification techniques in memory-constrained onboard processing units. Some of the classification techniques we intend to use with the above data-reduction techniques include, support vector machine (SVM), probabilistic neural network (PNN), k-nearest neighbor (KNN), principal component Bayesian analysis (PCA). To improve the diagnostic accuracy and efficiency of the above classifiers, we will apply classifier fusion techniques such as AdaBoost, Error correcting output codes, Voting to find which architecture will enhance the accuracy and under what conditions. Finally we will investigate Dynamic Multiple Fault Diagnosis that can work with imperfect fault/anomaly detection tests. As part of this task, we will develop novel factorial hidden Markov model-based inferencing techniques such as Lagrangian relaxation and Viterbi decoding algorithms to solve this difficult combinatorial optimization problem, for on-board vehicle health monitoring and fault diagnosis.