The diagnosis of motor failures using an on-line method has been the aim of many researchers and studies. Several spectral analysis techniques have been developed and are used to facilitate on-line diagnosis methods in industry. This paper discusses the first application of a motor flux spectral analysis to the identification of broken rotor bar (BRB) faults in induction motors using a multiple signal classification (MUSIC) technique as an on-line diagnosis method. The proposed method measures the leakage flux in the radial direction using a radial flux sensor which is designed as a search coil and is installed between stator slots. The MUSIC technique, which requires fewer number of data samples and has a higher detection accuracy than the traditional fast Fourier transform (FFT) method, then calculates the motor load condition and extracts any abnormal signals related to motor failures in order to identify BRB faults. Experimental results clearly demonstrate that the proposed method is a promising candidate for an on-line diagnosis method to detect motor failures.