A new algorithm based on intersection fault-tolerant fusion and unscented Kalman filter was proposed for fault diagnosis, isolation and reconstruction of skew redundant strapdown inertial navigation system. Considering the error coefficients of gyros, a unified model was built for redundancy configuration. A single point of failure can be isolated rapidly with the intersection fusion model, and an unscented Kalman filter was used for the error coefficients of isolated gyros, which can determine soft failure caused by error coefficients′ change. The simulation with configuration of 5 gyros shows the validity of algorithm under 2 soft failure caused by error coefficients′ change.