Wavelet　analysis　is　a　relatively　new　mathematical　and　signal　processing　tool.　It　is　a　time　frequency　technique　that　provides　more　detailed　information　about　non-stationary　signals,　which　is　superior　to　the　traditional　frequency-domain　Fourier　analysis.　Wavelet　analysis　has　been　applied　to　various　fields　including　civil,　mechanical　and　aerospace　engineering,　especially　damage　detection　and　structural　health　monitoring.　This　paper　is　to　provide　the　state-of-the-art　research　and　development　of　wavelet　analysis　based　structural　damage　detection.　The　theory　of　wavelet　analysis,　wavelet　analysis　based　damage　detection,　damage　location　identification　and　damage　severity　evaluation　are　presented.　The　further　work　to　be　done　is　also　discussed.