In order to solve the problem that a large number of vibration signals cannot be transmitted in real time in the application of wireless sensor networks (WSNs) in mechanical fault diagnosis, a mechanical fault diagnosis method based on multilevel and hierarchical information fusion of WSNs was proposed. In this method, the cluster tree network structure is used to expand the coverage of network monitoring, and WSNs information fusion is divided into three levels: data-level fusion, feature-level fusion, and decision-level fusion. The terminal node performs data-level fusion on the original vibration information to extract feature information; the cluster-head node performs feature-level fusion on the feature information to obtain pattern recognition results; and the gateway node performs decision-level fusion on the recognition results to evaluate the running status of mechanical equipment. The results show that the slight damage fault of the bearing inner ring can be accurately diagnosed by decision-level fusion based on four groups of probability distribution functions. According to the statistics of 30 test results, the fault recognition rate is 83.3%. The method can be applied to mechanical fault diagnosis effectively.