Integrating AI with State Estimation for Fault Detection in Dynamic Systems: Methods, Challenges, and Opportunities

Abstract

State estimation is a fundamental component of model-based Fault Detection and Diagnosis (FDD) in dynamic systems, underpinning real-time monitoring, predictive maintenance, and safety-critical operations across industries such as aerospace, power systems, robotics, and autonomous vehicles. Traditional estimators, including the Kalman Filter (KF) and its variants, provide physically interpretable residuals for fault detection but often fail to deliver reliable performance under nonlinear dynamics, modeling uncertainties, sensor faults, and non-Gaussian noise. This paper presents a comprehensive review of state estimation-based FDD approaches, with a particular focus on Artificial Intelligence (AI)-augmented Kalman filtering and hybrid frameworks that integrate Machine Learning (ML) models, including Neural Networks (NNs), Support Vector Machines (SVMs), and Gaussian Processes (GPs), with classical estimation theory. The review systematically evaluates model-based, data-driven, and hybrid methods, comparing their robustness, accuracy, computational efficiency, scalability, and interpretability in complex Cyber-Physical Systems (CPSs). Furthermore, emerging trends and open research challenges are identified, including online adaptation, fault-tolerant estimation, sensor fusion, explainable artificial intelligence (XAI), and deployment in Industry 4.0 and Internet of Things (IoT)-enabled environments. By bridging classical estimation theory with modern AI techniques, this review provides a roadmap for designing intelligent, adaptive, and resilient FDD systems capable of enhancing reliability, operational safety, and real-world applicability.