This paper presents an intelligent algorithm for heart diseases diagnosis using phonocardiogram (PCG). The proposed technique consists of four stages: Data acquisition, pre-processing, feature extraction and classification. PASCAL heart sound database is used in this research. The second stage concerns with removing noise and artifacts from the PCG signals. Feature extraction stage is carried out using discrete wavelet transform (DWT). Finally, artificial neural network (ANN) has been used for classification stage with an overall accuracy 97%.