A method and apparatus are disclosed in which defect behavior in an integrated circuit is discovered and modeled rather than assuming defect behavior in the form of a fault. A plurality of tests are performed on an integrated circuit to produce passing and failing responses. The failing responses are examined in conjunction with circuit description data to identify fault locations. For at least certain of the fault locations, the logic-level conditions at neighboring locations which describe the behavior of a failing response are identified. Those logic level conditions are combined into a macrofault for that location. The macrofault is then validated and can be then used to identify more tests for further refining the diagnosis. Because of the rules governing abstracts, this abstract should not be used to construe the claims.