A fault detection and isolation (FDI) problem is considered for inertial sensors, such as gyroscopes and accelerometers and a new FDI method for double faults is proposed using reduced-order parity vector. The reduced-order parity vector (RPV) algorithm enables us to isolate double faults with 7 sensors. Averaged parity vector is used to reduce false alarm and wrong isolation, and to improve correct isolation. The RPV algorithm is analyzed by Monte-Carlo simulation and the performance is given through fault detection probability, correct isolation probability, and wrong isolation probability.