All machines with moving parts give rise to sound and vibration and each machine has a specific vibration signature related to the construction and the state of the machine. If the state of the machine changes the vibration signature will also change and a change in the vibration signature can be used to detect incipient defects before they become critical. This is the basics of vibration based condition monitoring (CM) methods. The CM technique is based on detecting the presence of a fault, diagnosing the root cause of the fault, assessing its level of severity and making arrangements for its correction. A broad review of the state-of-art of condition monitoring and fault diagnosis techniques has been carried out for improving the accuracy and ability of condition monitoring and prognosis systems for bearing and gear components. © 2016, Research India Publications.