Blade fault is one of the most common faults in turbomachinery. In this article, a rotor system consists of multiple rows of blade was developed. The effectiveness of conventional FFT spectrum and wavelet analysis in the diagnosis of multi stage blade rubbing faults is examined at different stages, variety of blade fault conditions, and different blades rubbing severity. Blade fault caused impacts and the use of wavelets as analysis tool to detect the blade faults was studied. Results showed that, vibration spectrum can clearly depict the location and the stage of blade rubbing, while it is difficult to be identified in wavelet analysis. The limitations of wavelet analysis for multi stage blade fault diagnosis were identified. Some probable solutions to improve wavelet time-frequency representation in blade fault diagnosis were also presented.