In this paper we propose a new method to design robust fault isolation observers (FIOs). The technique exploits the duality between non-interacting control and observer-based fault isolation and provides additional degrees of freedom by means of dynamically extended observers. A general procedure to design such observers is given. The additional design variables are then exploited to increase robustness with respect to high-frequency disturbances while ensuring fast fault response times. The applicability of the proposed method is demonstrated in simulations.