Pipelines are regarded as the most cost-effective and the safest choice for transporting oil in bulk. In this study, the significance and necessity of conducting damage detection for onshore pipelines is firstly stated. Then, the limitations of current measures in use in pipeline industry and the inherent difficulty of applying vibration-based damage detection techniques (VBDT) to pipeline structures are addressed. This study focuses on exploring the applicability of an advanced VBDT method, HHT method, to the condition assessment of onshore pipelines. The feasibility and effectiveness of HHT method is verified through numerical study. The result shows that for the cases with single or multi segments of damage which are of the same type or of different types coexist in the structure, the HHT method is capable of providing very good results for the damage detection of pipeline system under ambient excitations. The obtained Hilbert spectrum gives very explicit presentation of the structural response’s energy distribution in both time and frequency domain, the marginal spectrum offers satisfactory result not only for locating the damaged area but also for a rough estimate of damage severity.