Though cellular phone networks already contain intelligent network elements diagnosing local faults, alarm bursts caused by network element failures cannot be handled properly by this technology. It is the responsibility of the operators to extract the relevant alarms from such a burst and identify the cause. To assist the operators, several alarm correlation tools have been developed. The paper introduces a model-based solution to the problem of alarm correlation. We use an abstract simulation model to predict the propagation of alarm messages through the network. By comparing the predicted behavior with the actual alarm pattern, the cause of the alarms is identified. The paper describes the model and its implementation using the diagnosis system DRUM-II.