This paper presents two new fault models for networked systems. These fault models are more realistic and generalized for networked systems in the sense that they can represent the effects of fault at the node and network levels. At the network layer, the uncertain effects of the network lines are modeled using a Markov chain with complex transition probabilities simultaneously with the stochastic behavior of the network using a Bernoulli process. A new output feedback-based controller, which is two-mode dependent and considers network uncertainties and output measurements for gain calculation, is presented. Using the tools of robust control and stochastic stability, linear matrix inequality-based sufficient conditions are derived. The proposed controller successfully maintains the system’s performance by tolerating the effects of simultaneous sensor and actuator faults, ensuring the stability of networked loops. Simulation results verify the applicability of the presented fault-tolerant control against multiple simultaneous faults.