Methods and devices are described for performing engine diagnostics during skip fire operation of an engine while a vehicle is being driven. Knowledge of the firing sequence is used to determine appropriate times to conduct selected diagnostics and/or to help better interpret sensor inputs or diagnostic results. In one aspect, selected diagnostics are executed when a single cylinder is fired a plurality of times in isolation relative to a sensor used in the diagnosis. In another aspect, selected diagnostics are conducted while the engine is operated using a firing sequence that insures that no cylinders in a first cylinder bank are fired for a plurality of engine cycles while cylinders in a second bank are at least sometimes fired. The described tests can be conducted opportunistically, when conditions are appropriate, or specific firing sequences can be commanded to achieve the desired isolation or skipping of one or more selected cylinders.