A system and method for detecting incipient mechanical motor faults by way of current noise cancellation is disclosed. The system includes a controller configured to detect indicia of incipient mechanical motor faults. The controller further includes a processor programmed to receive a baseline set of current data from an operating motor and define a noise component in the baseline set of current data. The processor is also programmed to acquire at least on additional set of real-time operating current data from the motor during operation, redefine the noise component present in each additional set of real-time operating current data, and remove the noise component from the operating current data in real-time to isolate any fault components present in the operating current data. The processor is then programmed to generate a fault index for the operating current data based on any isolated fault components.