The increasing complexity of ICs necessitates the use of test generation methodologies at higher levels of abstraction. We propose a computationally efficient RT-level test generation methodology that utilizes a divide and conquer approach. The hierarchical constraints for the module under test are identified through the proposed justification and propagation analysis. These constraints are then taken into account during the local test vector generation for the module under test, enabling the identification of the local test vectors that are guaranteed to be effective not only at the module-level but also at the system-level as well. High quality test sets are thus generated by the proposed methodology in a computationally efficient manner. Experimental results verify the performance boosts attained by the proposed methodology as well.