Many kinds of conditioning monitoring technique have been studied, so this study has inverstigated the possibility of checking the trend in the fault diagnosis of ball bearing, one of the elements of rotating machine, by applying the cepstral analyisis method using the adaptive noise cancelling (ANC) method. And computer simulation is conducted in order to verify the usefulness of ANC. The optimal adaptation gain in adaptive filter is estimated, the performance of ANC according to the change of the signal to noise ratio and convergence of least mean square algorithm is considered by simulation. It is verified that cepstral analysis using ANC method is more effective than the conventional cepstral analysis method in bearing fault diagnosis.