The development of accurate clinical biomarkers has been challenging in part due to the diversity between patients and diseases. One approach to account for the diversity is to use multiple markers to classify patients, based on the concept that each individual marker contributes information from its respective subclass of patients. Here we present a new strategy for developing biomarker panels that accounts for completely distinct patient subclasses. Marker State Space (MSS) defines "marker states" based on all possible patterns of high and low values among a panel of markers. Each marker state is defined as either a case state or a control state, and a sample is classified as case or control based on the state it occupies. MSS was used to define multi-marker panels that were robust in cross validation and training-set/test-set analyses and that yielded similar classification accuracy to several other classification algorithms. A three-marker panel for discriminating pancreatic cancer patients from control subjects revealed subclasses of patients based on distinct marker states. MSS provides a straightforward approach for modeling highly divergent subclasses of patients, which may be adaptable for diverse applications.