This paper proposes a simple diagnostic method to determine the number of open and short circuited PV modules in a string of a PV system by taking into account the economical factor, such as minimum number of sensors. The diagnostic algorithm has as inputs the irradiance level, the PV modules temperature, the number of PV modules present in the string analyzed and its output power. So, just temperature and irradiance sensors, as well as a power meter by string are needed in the monitoring system forming part of the fault diagnostic system. The proposed fault detection method has been successfully validated experimentally. (C) 2012 Elsevier Ltd. All rights reserved.