The vibratory response exhibited by industrial equipment is functionally related to the stress history experienced by the principal internal component represented at each measurement location assuming a linear elastic and isotropic behavior. Employing expressions developed elsewhere in the literature for the expectation of the accumulated fatigue damage, the remaining maintenance-free life of a given component may be estimated at any instant in its operating lifespan. Fatigue failure criteria appropriate to individual machine elements are considered in establishing performance standards. An on-line data acquisition and analysis system capable of processing vibration time histories is employed to compute the amount of accrued fatigue damage and its increments sustained by the mechanical elements monitored at each measurement location. The vibration histories are detected via piezoelectric accelerometers mounted at one or more critical points on the machine system. The signals are filtered, digitized, calibrated and subsequently processed by a minicomputer to produce the information necessary in assessing the relative condition of operating equipment. Experimental results utilizing the above technique, are presented for performance monitoring of miniature internal combustion engines developing 3 HP at 14,000 RPM.