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This paper deals with fault diagnosis of induction machines based on the discrete wavelet transform. By using the wavelet decomposition, the information on the health of a system can be extracted from a signal over a wide range of frequencies. This analysis is performed in both time and frequency domains. The Daubechies wavelet is selected for the analysis of the stator current. Wavelet components appear to be useful for detecting different electrical faults. In this paper, we will study the problem of broken rotor bars, end-ring segment, and loss of stator phase during operation.