In the study, acoustic emission (AE) was applied to monitor the wear-out failure in discrete SiC Schottky barrier diodes (SBD) devices with a Ag sinter die attach to successfully monitor the real-time progress of failure of Al ribbons for the first time. After eliminating background AE noise including the power on-off switch and the ambient noise via a noise filtering process, AE signals were successfully collected for the SiC devices during a power cycling test. Furthermore, AE monitoring was compared to the traditional failure monitoring method using forward voltage. Physics-of-Failure (POF) analysis was performed, and fatigue cracks and lift-off in Al ribbons were confirmed as the dominant failure modes for the discrete devices. Specifically, AE counts that correspond to one of the time-domain parameters of AE signals increased with power cycling, thereby corresponding to the observed fatigue cracks in Al ribbons leading to lift-off failure. Additionally, the AE count rate was highly correlated with the crack growth rate. Based on the relationship between an AE count rate and fatigue crack growth rate, the results indicate that AE monitoring can be used to understand the fatigue propagation in Al ribbons (i.e., failure mechanism) and also as an early warning before catastrophic lift-off fracture for power electronic devices.