This paper investigates the problem of an integrated fault detection system design for linear discrete time-varying systems with bounded power disturbances. In the integrated design of residual generator and evaluator, an approximated energy constraint is first imposed on the bounded power disturbances, and then selected by solving a min–max problem to achieve minimal-size set of undetectable faults under the condition of zero false alarms. To tackle the problem that the computational burden involved in solving the min–max optimization grows with time, the moving horizon method is proposed. The proposed approach in this paper has two advantages: (i) the approximated energy constraint on bounded power disturbances is explicitly selected as a min–max solution in the integrated design to improve fault detection rate; by contrast, when directly applying any existing fault detection method to the case of bounded power disturbances, a predefined approximated energy constraint is implicitly introduced without considering fault detection performance; (ii) the design objective of the proposed approach can choose to consider faults only in the recent time horizon rather than faults in the complete time horizon; this strategy enhances detection performance of recent faults and benefits early fault detection, but has not been considered by existing fault detection methods. Copyright © 2012 John Wiley & Sons, Ltd.