This paper proposes the structure of an agent and rules for fault detection and location on LAN. To find out a reason of critical fault incurred LAN, collision detection rule, error detection rule, broadcast detection rule, system location rule, and Internet application location rule ar shown. Also, the structure of multi-agent system and state transition diagram is portrayed to have connectivity with he set of rules. To verify availability of proposed rules, the process to find a faulty system is shown by monitoring and analyzing the LAN fault occurrences from the proposed set of rules. Such an rule based agent system is helpful to an Internet manager to solve a reason of fault and make ad decision from gathering management information.