Abstract. This paper describes the application of Discrete Wavelet Transform (DWT) to identify various types of nonlinear damage caused by, unbalance, rotor-stator contact and a breathing crack in rotating machinery. Multiple faults have been investigated based on numerical and experimental signal analysis using Fast Fourier Transform (FFT) and DWT. A four degree of freedom fully coupled model of the rotor-stator system that includes the nonlinear damage in the rotor vibrations was established using Energy principles. Existence of high system nonlinearity could not allow exhaustive discrimination of rub and crack by classical FFT. Therefore, the DWT was employed. The results provide detailed feature analysis of the fault signals. Practical vibration measurements through a data acquisition system interfaced with Rotor Kit-4 and crack simulator provided the test data. Experimental TimeFrequency analysis gave more realistic faults responses with variable faults features. Irregularity of orbit, harmonic peaks in the presence of rub and crack were unique and distinguished periodic motion from other types of motion. The presence of a crack shifted the critical speed location and exhibited sub-harmonic components, which were more prominent with rub in vibration response. The detailed decomposition signal by DWT method established inherent feature patterns that effectively discriminated the multiple faults.