As VLSI designs grow in complexity and size, errors become more frequent and difficult to track. Recent developments have automated most of the verification tasks but debugging still remains a resourceintensive, manually conducted procedure. This paper bridges this gap as it develops robust automated debugging methodologies that complement verification processes. Unlike prior debugging techniques, the proposed one exploits the hierarchical nature of modern designs to improve the performance and quality of debugging. It also formulates the problem in terms of Quantified Boolean Formula Satisfiability to obtain dramatic reduction in memory requirements, which allows for debugging of large designs. Extensive experiments conducted on industrial and benchmark designs confirm the efficiency and practicality of the proposed approach.