A machine diagnostic system is provided which includes a host computer for determining a health state of a machine. The host computer is operatively coupled to a network backbone. The system also includes a machine diagnostic module adapted to be integrally mounted to a machine, the machine diagnostic module being operatively coupled to the network backbone. The machine diagnostic module collects data relating to operation of the machine and preprocesses the data, and the host computer analyzes the preprocessed data in determining the health state of the machine. The machine diagnostic system includes a system architecture which facilitates the machine diagnosis. The system architecture includes several software layers which provide for collecting and preprocessing machine data, transmitting the collected and/or preprocessed data over a network and analyzing such for machine diagnosis and process diagnosis.