Currently power of the diesel engine is increasing continuously, where the wearing problems become more severe. The wearing happens irregularly inside the cylinder, which causes a high burden to the marine engine. In this paper, a novel scheme to measure the wearing and to represent the engine states has been proposed. To monitoring the states of the marine engine efficiently, a laser displacement sensor has been utilized to measure the wearing happening inside the marine engine. To eliminate the noise signals in the distance measurement, the wavelet transform has been adopted, which is robust against the noises caused by vibrations. An engine simulator is designed to develop the system for measuring the engine wears, where the superiority of the wavelet transform against the conventional filtering schemes has been demonstrated.