For a class of model uncertainty descriptions, plant/model mismatch can be directly incorporated into a model based fault detection scheme using Moving Horizon Estimation. The model uncertainty is represented by a set of bounded parameters which can be used to alter the dynamics of the model through injection of the measured output as well as inputs. The uncertainty class includes gain uncertainty as well as uncertainty in pole locations. Using a bank of filters, detection of exclusive fault scenarios can be accomplished. The proposed method is compared to other methods employing an adaptive threshold, and is demonstrated on a simulation example of a cold tandem steel mill.