In industrial processes, there exist faults that have complex effect on process variables. Complex and simple faults are defined according to their effect dimensions. The conventional approaches based on structured residuals cannot isolate complex faults. This paper presents a multi-level strategy for complex fault isolation. An extraction procedure is employed to reduce the complex faults to simple ones and assign them to several levels. On each level, faults are isolated by their different responses in the structured residuals. Each residual is obtained insensitive to one fault but more sensitive to others. The faults on different levels are verified to have different residual responses and will not be confused. An entire incidence matrix containing residual response characteristics of all faults is obtained, based on which faults can be isolated. The proposed method is applied in the Tennessee Eastman process example, and the effectiveness and advantage are demonstrated.