Many multivariate statistical techniques have been developed to solve fault diagnosis problems for productivity and quality improvement. Recently, nonlinear kernel techniques (e.g. support vector machines) have been successfully applied to a number of applications such as bio-informatics, face recognition, handwritten digit recognition, etc. The basis of these techniques is to map input data into a nonlinear space; these mapped data are then analysed. Using the kernel trick on these methods makes it possible to develop powerful kernel-based nonlinear techniques and to extract information from the mapped data. This paper proposes a new diagnosis method based on kernel Fisher discriminant analysis (KFDA), a nonlinear kernel technique. It utilizes KFDA to extract nonlinear patterns of data effectively. In addition, an orthogonal de-noising technique, called orthogonal signal correction, is incorporated into the proposed framework and used as a pre-processing step. This de-noising is executed before KFDA modeling in order to remove unwanted variation of data. A case study on two processes has been conducted. The proposed method produced reliable diagnosis results and the use of KFDA modeling combined with the orthogonal de-noising technique was able to improve the classification performance.